A new year brings new challenges to Degrassi. A merge with a neighboring school means Degrassi must now accommodate high school teens as well as middle school kids. Several new students now wander Degrassi's halls, including Joey Jeremiah's charming yet troubled stepson Craig Manning. The first day of school sees Ashley facing a world of animosity because of the disastrous party before summer break. Losing her popularity, reputation, and all of her friends may break Degrassi's "good girl".
Craig's father decides to violently teach his son a lesson about spending time with Joey and Angela. Craig is skilled at hiding the ugly purple bruises as well as the emotional scars but his new friends are still suspicious. Meanwhile, JT dedicates his time to pursuing "an older woman", namely Paige Michalchuk.
Emma is shocked when her mother reveals she has been dating Mr. Simpson. Emma promises that she doesn't have a problem with it but her attitude at school says otherwise. Spinner and Jimmy enter a break dancing contest while Emma and Manny are in a contest of their own over Craig's attention.
Ashley swallows her pride and tries to win her friends back. Her efforts work fairly well but Ashley's arrogant attitude leads to some nasty rumors about her. Toby ends up in over his head when he develops a crush on Spinner's little sister Kendra.
Emma isn't very comfortable when Mr. Simpson offers to help with her science project. Manny lets slip to the entire school that Mr. Simpson is dating Emma's mom. Spinner embraces his newfound reputation as a ladies man but upsets Jimmy when he asks out a girl Jimmy had his eye on.
Craig is delighted to have Joey's trust around the car lot and at home. However, Craig oversteps the boundaries when he takes his friends on a joyride while Joey is out of town for the weekend. Ashley tries to empress her edgy new friend Ellie by getting her bellybutton pierced.
Paige is love struck when she meets Dean, an attractive soccer player from another school. Despite warnings that Dean is too old for her, Paige flirts with him at a party and loves the attention. Things turn sour, though, when Dean pulls Paige into an empty bedroom and forces himself on her.
Manny has a huge crush on Craig so, naturally, she is ecstatic when he asks her out. Manny has the best date of her life but Craig has a different feeling entirely about their time together. Ellie starts sending "secret admirer" letters to Marco and her jealousies come out when Hazel makes a play for him.
Hazel faces an identity crisis during "International Day" at Degrassi. She feels ashamed of her background, leading her to lie about her ethnicity. But Hazel ends up even more confused when lying doesn't make her feel any better about it.
Spike and Snake are finally getting married! Emma is thrilled to be her mother's little helper for everything wedding related but it seems like all their plans start going wrong as the date draws nearer. As if stress about the ceremony wasn't enough, Spike finds out she's pregnant and struggles with whether or not to tell Snake.
Emma takes matters into her own hands and tells Snake about the baby. Snake and Spike have a long talk and decide the baby could be a blessing for them. The happy couple makes it to the ceremony just in time to walk down the isle in their jeans and t-shirts. The crowd cheers as Spike and Snake kiss, ready to face any difficulties the future may bring.
Just as Marco and Ellie's relationship heats up, Marco's doubts about his sexuality intensify. Toby is head-over-heals for Kendra and wants to spend every waking moment with her but trouble arises when Kendra starts to feel smothered.
JT gets in trouble in science class but he is elated when his punishment is spending a week after school with hot teacher Ms. Hatzilakos. Jimmy and Spinner decide to start a "truth pact", which ends up endangering their friendship.
When Emma agrees to get back together with Sean, he feels like he is on top of the world. Unfortunately, Sean's happiness is short-lived when his home life becomes more desperate and alcohol becomes his coping mechanism.
Jimmy and Ashley have finally patched things up and start dating once again. Even though Ashley's style has changed, she assures Jimmy she is still the same girl inside. Meanwhile, Toby and JT learn far more than they ever wanted to know when discussing birth control in health class.
Liberty is furious she didn't receive a spot on the girls' hockey team. Unable to get over the rejection, Liberty pours all her energy into being a ruthless team manager. Terri freaks out when she reads Paige's palm and finds Paige has no lifeline!
Paige is feeling whole again after lots of intensive therapy to help her get over the rape. She is convinced everything is back to normal until she finds out Dean will be at Degrassi for a basketball tournament. The possibility of seeing her rapist face-to-face sends Paige's well-organized world into a tailspin.
Craig is surprised when his father suddenly visits him and tells Craig he wants to be apart of his son's life again. Craig decides to spend more time with his father without telling Joey. Has Craig's dad really changed or will he relapse into his old ways? Meanwhile, JT is in a rough spot when Liberty agrees to tutor him on the condition that he accompanies her to the school dance.
After his father dies, Craig is distraught because of the fight they had the last time they spoke. He tries to get his life back on track but it turns out to be more difficult than he thought. JT makes good on his promise to take Liberty to the school dance, where Spinner and Paige are up against Jimmy and Hazel for Luau King and Queen.