Emily is raised by her father who encourages her to always follow her heart and dreams. But when her father dies leaving Emily all alone she has to be raised by one of her relatives, none of which want her. She hides under the table as they draw lots to see who will have to raise her. Aunt Elizabeth is drawn and Emily is sent to live with her, Aunt Laura and Cousin Jimmy at New Moon.
Emily moves to New Moon and Aunt Elizabeth forbids her to read or write fiction. Pandora, Emily's cat, is left on the side of the road by Aunt Elizabeth. After finding some old 'Letter Bills' in the attic, Emily uses the back of them to write letters to her father.
Emily is horrified when Aunt Elizabeth informs her that she must attend school. After a dreadful first day of being teased by the other students and meeting the mean teacher Miss Brownell, she meets Ilse Burnley and they become friends.
Emily discovers the ""Disappointed House"" which looks out over the seashore. She also gets a surprise when Teddy kisses her. A carpenter was building it for his wife-to-be when she called off the wedding days before it was set to take place. Both now dead, Emily must help the ghosts to see the truth so that they can finally be together. In the process revealing one of Aunt Laura's secrets. Emily also meets Perry Miller, who becomes the new New Moon chore boy.
Emily and Ilse are curous about who Lofty John exactly is and go searching on his property to find out more. After catching Emily he forces her to eat a 'poison' apple and sends her home. Despite trying her best to be brave she prays to her father who is on the road to heaven.
While searching through the attic Emily comes across her mother's, Juliet, doll. Aunt Laura restores it for Emily. Then Aunt Laura meets Ian Bowles and falls in love with him...until she finds out the truth about him which sends her back home in tears.
Oliver, Emily's cousin, announces that New Moon actually belongs to his father. His girlfriend Maida is pregnant and loses her job and is left penniless. Emily, Ilse, Perry and Teddy, get her settled in the Disappointed House and end up helping to deliver her baby. Maida leaves town, and Oliver takes responsibility for his child.
Young Duncan McHugh blames himself for his mother's poverty and depression. After an embarrassing incident at school, Emily befriends Duncan and brings him to New Moon. But when Aunt Elizabeth finds out who he is she sends him packing. His mother Alma and Aunt Elizabeth had both been in love with the same man, but he married Alma. Emily, Ilse, Perry and Teddy also defy an order not to go into town to watch the hanging of a murderer.
Miss Brownell leaves her post as teacher and marries the school inspector. Her replacement is Mr Carpenter, a once university professor. He encourages the children to find their own talents, the only problem is that he drinks. Emily, Perry, Cousin Jimmy and Aunt Laura have to get Mr Carpenter cleaned up for his final evaluation after he staggers to New Moon drunk.
Ilse Burnley wants to learn about her dead mother because her father never talks about her. Emily, whose own father is dead, feels sympathy for her and wants to help find some information. While visiting her Great Aunts they tell her the tales about what has happened to Ilse's mother. After running away Emily snares her foot in a rabbit snare and is rescued by her Cousin Dean Priest (2nd cousin, twice removed).
Emily decides to find out the truth about Ilse's mother. Cousin Jimmy and Perry, along with Ilse, break into a warehouse trying to find out if she sailed away or stayed in Blair Water. During a faver the truth is finally reveled.
When a racoon savages Emily's cat Pandora, Aunt Laura takes the cat to Dr Burnley where they share a bitter-sweet moment. When Ian Bowles asks Laura to marry him, she says yes, but not with her whole heart.
Aunt Elizabeth find Emily's treasured 'Letter Bills' hidden in the attic. Laura announces her engagement to the rest of New Moon.
New Moon suffers tragedy with the death of Aunt Elizabeth who went missing at sea. The family then discovers that Elizabeth had borrowed money from Scottish relatives and that New Moon now belongs to them.
Still recovering from the loss of Elizabeth the family begins to fall apart in some ways. Jimmy confesses about how much he did love Elizabeth, and while trying to hide from her own fears, Laura becomes addicted to laudanum. Emily tries her best to convince the Scottish relatives that she will give them everything she owns in exchange for New Moon, only to receive a reply saying the they are coming to P.E.I. to claim it.
Emily begins to realise that despite how tough Aunt Elizabeth was, a part of her truly loved her and missed her now. Laura increases her intake of laudanum, then suffers inertia and stays in bed. Uncle Malcolm replies to Emily and says that he will not take the diamond she found as payment (not enough) and that they are coming to claim what is now theirs.
New Moon is on tender hooks after Aunt Isabel Murray arrives to 'take over'. Emily is horrified when Isabel tells her sher will no longer be allowed to attend school and that in place of it she will have to earn money. Next she tells Cousin Jimmy to kill one of his own cows for food and takes the household keys off Laura.
Teddy's mother tries to convince her son that Emily and Mad Mad Morrison are involved romantically.
When Aunt Laura's addiction to laudanum worses, Isabel takes the step of putting her in an asylum without asking anyone else. Meanwhile, New Moon is up for sale and Stuart is planning on buying it. Emily doesn't want Laura in the asylum and goes to get help via Jimmy, Dr Burnley and Uncle Malcolm.
As Emily and Ilse continue to grow older, the adults are faced with some questions that the girls will stop at nothing to get answers for: The facts of life. Meanwhile, Ilse's father, Dr Burnley has accepted a position at Massachusetts' General Hospital. Not wanting to leave, Ilse and Emily plan to run away only to have Uncle Malcolm ruin it by getting ill to the point he is close to death. Dr Burnley saves the day and begins to redeem himself in the eyes of Blair Water residents.
The Devil is in Blair Water, or so says the Reverend Nicholas Pitch who has arrived in Blair Water to rid the town of him. Hysteria immediately follows as the townspeople are suspicious of everything and blame the Devil. Meanwhile, the younger townspeople start to ask questions about the Devil. Hysteria continues in what can be likened to the Salem witch trials. In all this it is Laura who become calm (the Devil has of course left her).
The attention of this episode is based on that old faithful story of love. The girls desperately want to ensure that marry and pray to St. Agnes for help. However, being the age they are, it is Cousin Jimmy who gets the answer when he falls for Eve Kinch. From a poor family, they seek shelter at New Moon. All goes well between the two until Eve's father, Abner finds out and loses his temper. Then the revelation comes, Eve is pregnant.
Despite disappoval from Eve's father, Abner, Jimmy plans to give Eve everything that she wants. Emily causes more problems when she gets the idea Eve is a Saint and wants it is be official by getting people to sign a petition. Abner is determined to keep the two lovers apart and finds Jimmy and Eve when they secretly rendezvous. After a struggle Abner Kinch is dead. One question remains, who killed him: Eve or Jimmy? Jimmy risks everything for the woman he loves…
Poor Baby Ollie is again being handed about after he is left on the Murray's doorstep. Hoping to reunite Ollie with Maida Flynn, his mother, the children devise a plan. However their plans are not to be as Perry's Aunt Thom and new "friend" the Madame Marlena shatter the plans.
Isabel, knowing full well of Emily's plans, forbids her to enter into the "Island Romance Contest". Having written the story of "Isabella of the Highland" Emily reluctantly puts it away only for Ilse to find and submit. When it wins first prize Isabel wants Emily to renounce the award and takes both her and Aunt Laura to Charlottetown to do it. Ian Bowles makes a return to the series with a pregnant Margaux Lavoie. Laura must face the truth as the lies and deceit become too much
In a surprise ending for the season we watch four separate outcomes for Laura's wedding day. Each is seen in the imagination of Emily and for a change we get to see the full talents of the actors get a chance to shine. However, this episode also leaves the question, which was the real thing?
The series returns and we find that Laura's wedding has not yet happened and that she is fighting a battle of the heart whether to marry Ian or not. Emily is now thirteen years old. Not wanting to see Laura marry Ian, Emily and Ilse are overjoyed when the news that Laura is thinking of cancelling the wedding reaches them. Things don't got to plan however when fortune's wheel decides to turn and Laura never gets to tell Ian as New Moon battles to find answers!
Ollie Murray who has been without his mother for a year is finally re-united with her. In the time which she has been gone much has changed in Blair Water, especially the death of Ollie's father, Oliver Murray Snr. who died in the Klondike. Maida sets out to prove her love for her son, but there is still the possibility that Maida is only after the gold which Oliver Snr. left his son.
Lightening is said to be able to change a person's life and so it does for Jimmy who does indeed have a change in life. After the bolt strikes him Jimmy is left in a coma, desparetly wanting Jimmy to be okay Emily wishes that he could be a ‘man of great wisdom'. When he awakens her wish has been granted, the damage which he sustained from the well accident seems to have vanished. Life changes dramatically for Jimmy as he achieves everything including world acclaim. But nothing can be compared to the joy of seeing Eve again.
As Director of the First Institute of Scientific Discovery and with great plans set out in front of him, Jimmy only really wants Eve to be his wife. Aunt Isabel as always objects to the marriage but it goes ahead and the wedding is beautiful. However the happiness is short-lived when Eve is arrested for murdering her father Abner Kinch and her fate lies in the hands of Jimmy.
One of the more hard to believe stories, this episode focuses on Perry and his life. His mother was sent to prison for murdering her husband ten years previous with an axe. Perry lived through the torments at school but he had long since forgotten about his mother. But Aunt Thom plans to break his mother out of jail and he has to help.
Vacinnation is what eventuates from this episode after Malcolm is put under quarantine for small pox. As always, no one listend to Dr Burnley's advise and the children get Malcolm off the ship concealed in a coffin. However fear takes hold when they realise that Malcolm bought a boy of six, Robbie Burns with him as well whose mother died on the ship. The community won't accept Robbie, who is only six, but black and Emily's efforts to make him feel welcome fail. Vaccination begins but then Malcolm falls ill…
Small pox spreads through Blair Water and Robbie Burns dies. Trying to help as many as he can, Dr Burnley turns his house into a hospital. Ilse then also falls ill.
Emily and Ilse write an article ""Kicking the cat"" for the newspaper. The problems begin once people start taking the advice of the column and misunderstandings in love begins. Then Mr Carpenter returns and falls in love with Isabel Murray.
The truth is sometimes better left on the shelf and that is what Emily learns when she tries to overcome her writer's block. Deciding to write about what she knows she sees Rhoda's mother, Velma, as the perfect subject. ""Confessions of an Adulteress"" causing more problems when Rhoda falls for Harrison Bowles who is visting New Moon, soon Rhoda is losing control of all angles of her future.
Family bickering at it's best abounds at New Moon when it is left to Isabel, Laura, Emily and Jimmy. Isabel, who doesn't want to share wants to get the documents confirming this nulled and does everything she can. It is Uncle Malcolm who shows a side of him when Isabel goes too far to keep New Moon and he finally realises the truth about his family.
While her friends all head off for Shrewsbury Emily is left behind in Blair Water because her Auth Ruth refuses to have Emily stay with her. Bitterely disappointed, Laura tries to cheer her up by telling Emily that she has left Ian for good. An ally of sorts then comes to Emily's help and her future takes a turn for the good, but things aren't so good for Laura who discovers something unexpected.
Laura is still refusing to return to Ian and Emily helps her out by finding her employment at a mill. There Laura finds out just how hard the working conditions are for women in the 19th century. However, Ian finds out where she is and tries to force her to return back to his home. When Emily and Ilse find this out they go to visit her at the mill but Laura appears to have disappeared.
No one knows what happened to Laura Murray and Emily and Ilse want to find out. In order to do that, they go to see Ada Pickett, who tells them they are too young to understand the truth. Not wanting to listen to that advice, the girls dress up as older women and through a twist of events they see three different fates for Laura through their 90 year old eyes. They only question left unanswered: Which one is true?
Emily is feeling very insecure with her future as she begins to take the entrance exam for college hoping to get the scholarship - which Ilse and Teddy are also trying to get. On the way to exam they meet Jack and Emily pays for him to do the exam as well. Ilse tries to play matchmaker to get Jack and Emily together so she can go after Teddy. While in the exam Rhoda arrives late and isn't aloud to so the exam, she decides to let Emily's horse loose. Jack ends the exam early to go and catch it for her. On the way home Ilse falls asleep when they stop for a rest and wakes up in time to see Emily and Teddy kiss.
With her father's wedding approaching fast, Ilse is resenting the fact that she will have a step-mother that isn't Laura. She isn't about to let her father forget the fact that Laura and Iris are two different people.
The family is whole again when Jimmy returns home. Laura still wants a divorce but Ian Bowles returns and he now owns a share of New Moon. Emily comes up with the idea to marry in order to pay for Aunt Laura's divorce so she can retain rights to the farm. She tries to become a mail order bride. While she is writing it Teddy arrives, at first she ignores him, but when he climbs up to her window they go outside to talk.
Perry returns to Blair Water only to be leaving shortly to fight in the Boer War. Other strange occurances are also going on with a love letter finding its way to Cousin Jimmy and a stranger coming to town.
Jack is still trying to make a go of his fox hunting business and talks Cousin Jimmy into being a partner after he doesn't know how else to pay for Emily's fees; not to mention that Aunt Laura is pregnant. While the fox business turns out to be very profitable, the dreams of being rich get Emily's imagaination going into overdrive meaning a hard lesson to learn.
Emily is feeling as happy as can be and has been writing for weeks and sending her work off. As she is waiting Rhoda takes off with Emily's mail before she gets a chance to see it. She does this for a while as Emily is receiving acceptance letter and money cheques from a New York publisher Thelonius Grand. Her plans goes astray when the publisher days that he is coming to the island to meet Emily. It all comes out in the end although Rhoda nearly pulls off the scam only to have Emily give her a gift. Ian also leaves New Moon and is believed to have committed suicide. He gave his rights up to Laura for New Moon and she is left to raise Margaux's son.
Overjoyed at finishing her first book she goes to see Teddy to see what he thinks of it. Only he breaks her heart when he is brutally honest about it bringing back memories of Dean Priest. Emily then falls down the stairs and remembers back through a series of flashbacks the moments in her life that have shaped her future.