The episode begins with Naofumi and her companions preparing for the revival of the Phoenix, which is now only two months away. They focus on strengthening their defenses and improving their combat skills. Ren, the Sword Hero, is seen serving breakfast to the villagers.

A new character is introduced, Ratotille Anthreya, also known as Rat. She is an alchemist banished from Faubrey who specializes in enhancing monsters. Ratotille shows interest in Filo and the monsters Naofumi has raised. Despite initial skepticism, Naofumi allows Rat to join them, recognizing that her knowledge could be useful.

Upon their arrival, another caterpillar is discovered in the village, which they immediately take into their care. Naofumi, distrusting her intentions, insists that she bears a slave crest to ensure her loyalty.

A pivotal turn occurs when Naofumi receives a dragon egg from Siltvelt. From the egg hatches a dragon, named Gaelion by Wyndia, a girl from the village. Gaelion quickly befriends Naofumi and the villagers.

The plot takes a twist when Gaelion swallows the core of an imperial dragon and transforms into an even more powerful and uncontrollable form. This unexpected event triggers panic and confusion among the villagers.

Naofumi and her team struggle to subdue Gaelion, who now poses a threat to the village. The episode ends with the group trying to figure out how to save Gaelion and prevent him from causing harm.