A mailman drives up to Shigure's house as Tohru franctically brings down Kyo, Yuki, and Shigure in their animal forms trying to get the mailman to help her. However, he thinks instead that Shigure got new pets as Shigure the dog puts the mail letter in his teeth and the mailman is on his way.
After the mailman leaves, an angry Kyo yells at Yuki and Shigure over their failure to cover up their transformations. Tohru becomes shocked at the fact the three can talk while they are animals. Realizing that it was pointless to cover up, Shigure explains to Tohru that the Sohma family is cursed by the spirits of the zodiac animals. Whenever a cursed member is hugged by a member of the opposite sex, they turn into one of the 12 zodiac animals, counting the Cat. As he is about to explain that the transformation is temporary, he, Kyo, and Yuki transform back in the nude which freaks Tohru out.
Afterward, Shigure apologizes to Tohru about their transformations and asks how she feels about finally meeting Kyo, the Cat of the zodiac. He starts getting in a teasing mood towards Kyo poking fun of him for not seeming as perfect as he seems and blinded by his desire to defeat Yuki. Nearby, an angry Kyo protests accusing Shigure and Yuki of having a girl in their house. Yuki replies that whomever they allow in their house is none of Kyo's business.
Angry, Kyo breaks a table into two with a punch. However, one of the table halves hit Tohru in the head opening up a cut and making her bleed. In response to this, Yuki slaps Kyo in the face and to reprimand for "his stupidity," he won't hold back in fighting Kyo. The two start a fight. As Tohru tries stepping in to stop them, Shigure tells her not to worry as he bandages up her cut saying the fight won't take long. Yuki effortlessly beats Kyo by kicking him through a door outside.
As Yuki focuses his attention back on Tohru, the girl remembers that she has school and changes into her dirty school uniform from the landslide. Shigure says that she should not go to school as she is now. But after being told about her mother's promise, he allows her to go. But because Tohru now knows of the curse, Shigure tells her that he will have to tell the clan head, Akito, about it.
As Tohru bolts off to school, an upset Yuki asks if Shigure intends on removing Tohru's memories of the curse. Shigure replies that he has no such plans as this incident was different from the last time so many people knew about it.
At school, Tohru gets her uniform washed as Uotani gets suspicious over how it got dirty. The Yuki Fan Club girls show up to try teasing Tohru. However, they get chased off by Hanajima. Uotani goes on to say that Yuki is running late getting to school than usual. Tohru thinks to herself that she can't tell her friends about living with the Sohmas.
Later, Tohru meets up with Yuki. He asks Tohru if she told her friends about the curse. While Tohru assures him that he won't tell anyone about it, Yuki warns her that there is the possibility that she will get her memories erased. When he was seven, a bunch of kids had their memories erased when they learned of Yuki's curse. Reflecting back on that event, Yuki remembers Akito telling him that people would think of him as a freak if they learned he could turn into a rat.
Distraught at these memories, Yuki tries running off. But as Tohru grabs him to stop him, Yuki transforms. She apologizes for the trouble. Afterward, she thanks Yuki for worrying about her and wishes to still be his friend, even after losing her memories. Yuki transforms back after she thanks him.
As Yuki gets himself dressed, Tohru notices that his necktie isn't properly knotted. As she fixes up his tie, Yuki recalls Akito's comments and asks Tohru if she is sickened with him. Tohru misinterprets his comment in thinking he asked if she felt better from her fever. The two walk off back to class together.
At the main Sohma house, Akito gives his approval of allowing Tohru to live with Shigure and keep her memories.
Later on, Yuki and Tohru arrive back home. As Tohru goes to take her schoolbag into her room, she sees Kyo repairing the damage from when he crashed through her room. Kyo tries apologizing to her, but Shigure's loud arrival drives him out of the house again in anger.
Shigure tells Tohru that she is still allowed to stay with him and Yuki under the condition she keep the curse secret. Yuki has his doubts with this news thinking that Akito has something planned with Tohru. With this good news, Tohru thanks the two for allowing her to now be a part of their household.
The next day, Tohru cleans up the ridiculously dirty kitchen of Shigure's house while Shigure and Yuki are away. Yuki arrives later on and is impressed that Tohru was able to clean up their mess. Tohru prepares lunch for the two of them. Yuki says that he likes her cooking when they have lunch. Tohru then asks where Yuki went off to. He says he went off to his 'secret base.' Tohru mistakes the base as a secret clubhouse. But, Yuki promises her that he will let her see it the next time he goes to it.
An angry Kyo steps into the house annoyed over Shigure taking control of his life as he stomps upstairs. Shigure then steps in and explains to Tohru and Yuki that he tricked Kyo into taking entrance exams to be a student at their school. Kyo passed the exams. This news doesn't go along well with Yuki. Tohru wonders if Kyo is upset with the thought of having to be around Yuki.
The next day at school, Kyo's presence as a new student gets a crowd of girls swarming around him. Hanajima admits to Tohru and Uotani that Kyo has the same vibe as Yuki does. A visibly-annoyed Yuki admits to Uotani that his relationship with Kyo is strained. Flustered with the crowd swarming around him, Kyo jumps out of his second-story classroom and runs off.