Faced by Jim's betrayal, Matt tries to flee by boat but is waylaid by the mermaids. On Earth, the banished Winx fairies battle Jim's pirate army.
- Jim banishes the Winx from the World of Dreams and Matt chooses to side against Tinkerbell, unable to believe her words.
- Matt flees into the forests of Neverland and the Shaman is captured.
- The Shaman tries to convince Tiger Lily of Jim's true intentions.
- The Crocodile Man, Alligator Man and the Pirates are sent to Earth to uphold the Winx's banishment.
- Jim takes Tinkerbell to the Mermaid's Lagoon and has the mermaids lock her up in the Coral Prison for her crimes.
- Matt infiltrates the Mermaid's Lagoon to rescue Tinkerbell before the tides take her.
- Matt destroys the Coral Prison and frees Tinkerbell, but it is not over yet, as Jim returned to the Lagoon to finish the job.
- Musa and Aisha incapacitate the Alligator Man while Bloom and Flora capture the Pirates and deduce that Jim is the true traitor to all.
- The Shaman and Tiger Lily arrive on Earth and aid Stella and Tecna against the Crocodile Man.
- Matt and Jim do battle in the middle of the Lagoon where Matt loses the Barrie Sword and is pulled into the depths by the mermaids.
- When Stella and Tecna are walking down in the sewers, when the Crocodile Man attacks them, Stella kicks him back in the sewer water, the gunk and dirt on her have vanished.