Ace says goodbye to his friends at the circus. Indigo apologises for snooping in his sketchbook, but he says that thanks to her, he's finally going home. Zephaniah drives him into town, but Ace isn't sure where the house in his dream is. When he eventually finds it, the family there don't recognise him, and reject him as their son. He reluctantly asks Zephaniah to take him back to the circus. Indigo tries to convince him not to give up on his dream, but he sadly says that the circus is his only family now. She is convinced she can find the truth if she looks in "the right place."
The next day, a distracted Ace struggles to perform. Indigo breaks into Zephaniah's trailer, where he catches her and reveals his collection of glass eyes: all of which contain powerful magic. He shows her the most magical of all, which implants false memories in the minds of the performers; then uses another one to render her mute so she can't tell anyone what happened. Zephaniah decides to make an example of her, and as she says goodbye to Ace, she hands him a sheet of paper. Zephaniah forces her to step over the boundary line, which magically turns her into a piece of shrivelled wood. He picks her up and displays her with others, revealing he is the only one who can cross the boundary without consequences.
Ace tries to show the other performers the paper that Indigo gave him, which warns him to destroy Zephaniah's glass eye. He breaks into Zephaniah's trailer at night; but sneezes, waking up Zephaniah. He escapes, but drops all the eyes; Zephaniah picks up the one responsible for memories, and tosses it over the boundary line. However, Ace uses another eye to destroy the boundary, enabling the circus strongman to crush the eye that controls everyone's memories. The performers turn back into their true forms: all are really animals, explaining their talents within the circus. Zephaniah says he gave them the gift of human life and the spotlight, but Ace says this wasn't his choice to make for them. He is dragged away screaming by the former clowns, now a trio of monkeys again.
Ace rescues Indigo and says goodbye to her as she changes back into a hummingbird. He returns to his family home, where he turns into a dog, with the family delighted to be reunited with their lost pet.
Meanwhile, The Curious passes by the circus and retrieves one of Zephaniah's discarded eyes from the ground.
This episode contains examples of:
- And I Must Scream: Indigo (along with others who "betrayed" Zephaniah) being turned into an apparently conscious lump of wood. They are all returned to normal and become animals once Zephaniah’s glass eye is broken.
- Animorphism: Played with: all the circus performers turn into animals, but it emerges that they were animals all along.
- Bittersweet Ending: Ace has to say goodbye to Indigo and his other friends, and he doesn't have parents and siblings as he thought he did. But he still gets to go home to his human family, who love him as he really is: a pet dog.
- Eye Scream: Zephaniah lost an eye at some point at some point in the past, although it's not mentioned what happened to him.
- Glass Eye: Zephaniah has a collection of them, and it's how he enchanted everyone in the circus.
- Period Piece :Like the previous part the setting in this two part episode takes place sometime in between the 1920s to the 1940s
- The Dog Bites Back: It's implied Zephaniah is killed by the clowns after they change back into monkeys.
