Mr. Morloch has left the school to coach a semi-pro ball team in Buffalo. Holly is leaving to star in a soap opera being shot in Hollywood. Nicole decides to audition for several roles and when she gets a small role in a Broadway play, new principal Mr. Dyrenforth, tells her she has to choose school or the play. An old neighbor tries to use his connection with Leroy to sway his audition.

Leroy severely injures his knee and is forced to go through an operation and rehabilitation. He recovers but when he returns to the school, he fears injuring himself again instead taking his anger out on Henry Lee, a returning applicant. Miss Grant is determined to push Leroy back into dancing before he gives it up forever. Reggie has a crush on Max.