The episode opens at the SGC with SG-1 tumbling through the gate, drenched, in a state of shock, and Daniel is missing. Upon further questioning, it is revealed that Jack, Carter, and Teal'c all saw Daniel surrounded by fire calling for help, but they were unable to help him, and watched him die. Fraiser examines them, and finds them simply in a state of shock. She gives them sedatives to help them rest. Hammond then mentions to her that he wants to put them back on duty to help them move on, she requests time for them to mourn. He gives them a week before putting them back on active duty.
The SGC holds a memorial service in the gate room, complete with Jack and Carter sending a memorial wreath through the gate to...somewhere. They hold a wake at Jack's place, and he sees the bubbles as he is pouring a beer, which triggers a flashback to the vision of Daniel. He freaks out and walks off and is found wildly slapping roller hockey pucks into a net and then smashes a car window. Hammond comes over and offers Jack some consolation.
We then find that Daniel is indeed alive and well, in some sort of underwater room. An alien creature enters and motions towards some ancient writing on the wall. Daniel translates it as best as he can, and the alien seems angry that he can't answer the question. He knocks Daniel out and leaves.
At the debriefing later, Jack is saying that he feels Daniel is alive, but also dead. Hammond mentions sending a team to look for his remains, and instantly all 3 of them say that they cannot go back to the planet, which is odd. Hammond also asks them how long they thought they were on the planet, which was around 3 hours. They all think they were there for 30 minutes at most. Jack then states that they need to go back, and instantly suffers a strong headache. Dr. Fraiser is called on to examine them and finds that a small portion of their minds appears to be affected in the same way. They decide to attempt hypnosis to find out what happened.
Daniel reawakens and is shown more cuneiform writing. He translates what he can and gets in an argument with the alien who can now speak some broken English. Daniel is able to find out that the alien is trying to find out about a specific person who lived in ancient Babylon, who happened to be the alien's mate. She went to earth to fight against the Goa'uld. Daniel tells him it's impossible, that information has been lost to time, and the alien is convinced that he knows, somewhere in his memory. Daniel says that he can't remember, maybe the alien should use his memory device to find it. The alien says it is risky, he could die if they did that. Daniel says that everyone else already thinks he's dead, what does it matter.
Carter undergoes hypnosis and we find that they met the alien creature, who found that Daniel recognized the writing of ancient Babylon. The alien then knocked them all out and rewrote their memories so they wouldn't come searching for Daniel. SG-1 then knows that Daniel is alive and head back to the planet to find him.
Daniel allows the alien to use his machine to try and activate his memory. He recalls reading that she was cut down by the Goa'uld for her opposition. The alien lets out a wail of anguish and leaves, leaving the door open so Daniel can leave. SG-1 arrives on the edge of the water as the alien is surfacing with Daniel not far behind, and return home.
"Fire and Water" provides examples of the following tropes:
- Agony Beam: The memory device that Nem uses on Daniel has this effect.
- Aliens Speaking English: Averted, for once. Nem originally communicates with Daniel using cuneiform writing and only gradually picks up some English.
- Anti-Villain: Nem is holding Daniel hostage and doesn't treat him particularly well to begin with, but he does it because he wants to find out what happened to his "mate", and he is initially reluctant to use the memory device for fear that it could be harmful.
- Big "NO!": Nem, once Daniel reveals that his mate has been dead for thousands of years.
- Burial at Sea: The memorial service has shades of this, being held in the shimmering light of the Stargate and ending with O'Neill and Carter sending a wreath through it.
- Continuity Nod:
- While clearing out Daniel's apartment, Carter finds his journals from the movie and the pilot episode, among other things.
- Earlier, during the wake, O'Neill reminisces about Sha're planting that kiss on Daniel in "Children of the Gods".
- Distressed Dude: Daniel.
- Due to the Dead: Of all the many, many times throughout the series that Daniel would be missing, presumed dead, or actually dead, this is the only time they actually hold a funeral for him, at least that we see, and ironically, it's one of the instances where he isn't really dead.
- Fake Memories: Nem implants O'Neill, Carter and Teal'c with memories of Daniel's death so that they won't return to the planet for him.
- Humanoid Aliens: Nem is some kind of humanoid fish-creature.
- Kill It with Fire: What the rest of the team initially believe Daniel's fate to be, thanks to Nem giving them false memories of the event.
- Laser-Guided Amnesia: In addition to the above-mentioned false memories, the rest of the team have no recollection of the rest of the mission, to the extent that they believe they were only gone for around twenty minutes, while Hammond reveals it was closer to four hours. Carter is eventually able to regain her memories with the help of hypnosis.
- Long-Lived: Nem's people seem to be this, as Nem was alive during the days of Babylon more than 4000 years ago.
- Never Found the Body: The team believes that Daniel completely burned up in the fire, leaving no remains to bring back.
- No One Gets Left Behind: Carter is horrified when she remembers the real version of events and realizes that they left Daniel behind, and the rest of the team immediately mobilizes to retrieve him.
- Percussive Therapy: O'Neill smashes a car window with a hockey stick at Daniel's wake.
- Personal Effects Reveal: Carter finds Daniel's mission journals while the team is cleaning out his apartment.
- Trauma Button: The sight of rising bubbles - such as in O'Neill's beer or the fish tank in Daniel's apartment - seems to trigger a traumatic Flashback to Daniel's 'death' in the remaining members of the team.
- True Companions: Hammond asks the rest of SG-1 to sort through Daniel's personal effects after the funeral, as they are the closest thing he has to family.
- What Happened to the Mouse?: Nem's race is never seen or heard from again, despite the fact that they appear to be technologically superior and likely had a hand in overthrowing the Goa'uld on earth, making them ideal allies.
