The episode opens in the year 1920. A group of bootleggers smuggle Canadian Club whiskey from boats into the United States, but are later ambushed i
n their trucks and held at gunpoint by two men in ski masks. The scene then cuts to two days prior, as Atlantic County treasurer Nucky Thompson delivers the keynote address at a Women's Temperance League rally on the eve of Prohibition. He inspires the all-female audience with his rags-to-riches story and anti-alcohol rhetoric. 
Thompson leaves the rally early and promptly heads to Babette's Supper Club, where a raucous gathering of elected officials, including Atlantic City's mayor and Thompson's brother, Sheriff Eli Thompson, are celebrating the onset of Prohibition and the lucrative bootlegging opportunities it will bring. Thompson lays out the logistics and introduces his driver Jimmy Darmody, who has just returned after serving in World War I, and appoints him an assistant to Paddy Ryan, a young ward boss who is part of Thompson's political machine. As midnight strikes and Prohibition officially goes into effect, the partygoers in the club all toast the "death" of alcohol - and merrily continue the party. Moody and uncomfortable, Darmody quickly leaves.
The following morning, Darmody and Angela, his wife, discuss their future. She wants him to return to his studies at Princeton; he believes this will take too long, and decides to continue working for Thompson. Meanwhile, Thompson meets Margaret Schroeder, a pregnant member of the Temperance League. When she asks about a job for her husband, he gives her a wad of money and has Darmody drive her home.
As night falls, Darmody and Thompson visit Mickey Doyle's funeral parlor, a front for distilling alcohol. Mickey pranks Darmody by giving him a drink of formaldehyde; Darmody attacks him, nearly compromising the operation. Scolded by Thompson, Darmody demands more important work, and implies that the war has matured him. Thompson at first cajoles him, but ultimately challenges Darmody to make his own opportunities.
Afterwards, Thompson dines with four major mob figures, New York's Arnold Rothstein and Lucky Luciano and Chicago's Big Jim Colosimo and Johnny Torrio, who agree to start buying Thompson's seaborne liquor shipments. Arnold Rothstein requests some alcohol for a friend's wedding and Thompson agrees to sell him his latest shipment, on the condition that Rothstein's own men pick it up. Rothstein asks to defer payment until the next day. As Darmody waits for Thompson outside, he befriends Torrio's driver, Al Capone.
The next day, Rothstein, a well-known card shark and cheat, takes Thompson's casino for over $90,000. Thompson arrives and gets Rothstein to leave with his winnings, less the cost of the whiskey shipment. As he leaves, Thompson is confronted by Hans Schroeder, Margaret's jealous and abusive husband. When Thompson sees Hans gambling with the money he had given Margaret earlier, he throws him out. That night, the drunken Hans severely beats Margaret, causing her to miscarry.
The day of the heist arrives. Darmody recruits Capone to hijack Rothstein's whiskey shipment. The episode returns to the conclusion of the opening robbery, in a montage interspersed with scenes from a misogynistic comedy routine attended by Thompson and his mistress. Capone, startled by a deer, opens fire on the surrendering smugglers; Darmody and Capone kill them all and flee with the stolen trucks. At the same time, only three miles away, a team of federal agents raid Doyle's funeral parlor.
With his brother's help, Thompson deduces that Darmody had met with agents the day before and informed on Doyle in retaliation for his formaldehyde prank, and therefore must also be involved in the simultaneous robbery. When confronted, Darmody admits that he counted on Thompson's forgiveness and again asks for his help with more aggressive criminal enterprises, claiming that the war has left him with no future other than violence. Darmody seals Thompson's complicity by presenting him with a share of the take, and warns him that Thompson can no longer afford to be "half a gangster."
Thompson learns about Margaret's hospitalization. He has his brother Eli, the sheriff, kidnap Hans. Scenes showing Eli and his deputies taking Hans out to sea and beating him to death are interspersed with the assassination of mob boss Big Jim Colosimo in his Chicago restaurant. A radio reports that the police have named Hans as the suspect in the murder of Rothstein's men, implying that Thompson will continue to protect Darmody. The episode ends with Thompson delivering flowers to a recovering and widowed Margaret.