Since Stefan doesn't drink human blood, Damon has the power to get into his dreams. He plants a nightmare about him (Damon) killing Elena. Kind of rude, huh? Stefan thinks so, so he stabs Damon. Damon stabs Stefan back. Seeing how you're undead, that could go on all day, boys. No. Really. Take another gander at Stefan's six-pack before you decide. See? Now, where was I? Oh yes, we learn from Logan "Scum" Fell (current Mystic Falls news reporter and guy who done Aunt Jenna wrong) that the wild animal that's been killing everyone is a mountain lion. The lion roars, "I've been framed," and points a paw at Damon, but the authorities turn a blind eye to the poor beast's plight. Stefan's reads him loud and clear though, and resolves to stop Damon. Once Damon turns on their human relative, Zach, Stefan suddenly has a less-insane Renfield of his very own. Zach's been growing Vervain in secret, down in the musty cellar of Mossy Manse. Stefan needs the upper fang, so he spikes Damon's scotch with it, but Damon's been around the block and isn't fooled, only angry.

Meanwhile, the town is all atwitter about the annual Founder's Ball. Elena gives a collection of Gilbert heirlooms to Tyler, so his mom can display them at the ball. His dad is the mayor, and the shindig is happening at their mansion. Jeremy swipes the pocket watch beforehand, though, because it was to go to him upon his father's death. When Elena finds out, she takes it to bring to the ball, but at the last moment, relents and leaves it with Germ. While Caroline's getting ready, Damon hypnotizes her to wear the dress of his choosing, and then they have a little interlude. I'd call it romantic, but it's more a mix of hot, creepy and sad. They kiss. Caroline, who is aware Damon is a vampire, asks him if he's going to kill her. Damon says he is, but not yet. He has something he needs her to do for him. She agrees, and says she'd do anything for him, and this character I thought was going to be but a shadow of BtVS/Angel's Harmony manages to break my heart in two seconds. While Elena and Bonnie get ready for the ball, Bonnie spills the beans that Caroline told her in "confidence" about Stefan and Damon's past. Supposedly, Stefan was the bad guy in the Damon-Katherine-Stefan triangle. He lied to Katherine, in order to turn her against Damon. Bonnie -- who reluctantly joined Team Stefan after dinner last week, is now back to warning Elena to be leery of him. While she's with Bonnie, Elena recognizes this intel for the Damon-plant that it is, but at the ball, when she's dancing with Stefan and he won't open up about Katherine, she turns on him and stomps away. Caroline's with Damon, and her sheriff-mother isn't pleased about this. Seems her father is on holiday with his boyfriend, though, so what's a single mother to do, even if she has a big, honking, service revolver? Aunt Jenna and Bonnie each go stag, and while Logan tries to rekindle the flames between him and Jenna, Bonnie discovers she's a firestarter, and that Ty's mother is a bitch.

In the rest room, Elena spies Caroline's bite marks and bruises, realizes they're from Damon, and gives him what for. She then goes to Stefan to apologize, but things remain tense between them, because he acknowledges he already knew Damon had something sick going on with Caroline, and yet all he'll tell her is that she has to trust him, and that he'll handle it. Elena points out that trust has to be earned, but Stefan barely has time to listen to her, because he sees an angry Damon dragging Caroline off into the night -- chastising her about letting Elena see her injuries.

Damon's well and truly done with Caroline and lunges for her neck, but it turns out she's not good to the last drop. When Damon took Elena off for a chat during the ball, Stefan drugged Caroline's champagne with Vervain. Since his girlfriend/victim is a walking Mickey, Damon collapses. Stefan drags him off and locks him up in the dungeon at Mossy Manse. When Caroline comes to, she's on the lawn alone. She finds the amber crystal that Damon swiped from the mansion earlier. As she stands there alone and freaked out, Elena finds her. Caroline sobs in her arms.

At the Mayor's mansion, Ty's parents, Caroline's sheriff-mom and Logan "Scum" Fell lament the fact that they didn't get the Gilbert watch. Mrs. Mayor says Elena said it must still be packed up with her parents' things. Scum says he can get it. Sheriff-Mom says, "Good, we're going to need it," and then this unlikely quartet seems to reveal itself as a citizens' Council of Watchers. Sheriff Mom notes that all five bodies were completely drained of blood. Scum says, "They've come back," and we fade to black. I'll catch you on the flipside with the full weecap, because there's more fun to be had with Ty, Germ and Vicki, some Twilight mockage and props for Anne Rice. In the meantime, do not accept any drinks from strange men.