Inside Cats Lair, Panthro and Tygra are working on extracting pureThundrillium from the meteor that Lion-O retrieved from Hook Mountain. One of the main impurities that had contaminated the meteor was Gold, which Panthro describes as being "junk" due to its inert chemical nature. He then gathers all the gold and dumps it into the Bottomless Chasm using theThunderTank.
Meanwhile, Lion-O and Snarf are out on another exploring trip and come across a series of small and big caves which are the homes of the Trolls and Giants. Suddenly, a troll appears, riding a giant grasshopper. He introduces himself asGrygory Grygion and goes on to explain that he must ride through the Midnight Woods carrying valuable goods and is afraid that the "Shadow Robber" who lives there will harm him. Lion-O agrees to accompany him on his trip in order to protect him.
The trio soon reach the Midnight Woods where visibility is very poor due to it being dark. A shadowy figure suddenly lunges at Lion-O and attacks the young lord with a whip-like weapon which causes the Sword of Omens to break into two. The intense sparks emanating from the broken pieces of the sword illuminate the scene just enough to reveal that the Shadow Robber is none other than Tygra. At that moment, the troll transfoms into Mumm-Ra and flies away, laughing maniacally.
Lion-O and Tygra realize that they had both been tricked by Mumm-Ra. The young lord commands the sword to show its power but it does not respond. Jaga then appears and informs them that by attacking a fellow ThunderCat, Lion-O had incurred the Curse of Balthaz. Jaga also informs them that the only way to repair the sword was to forge its blade in Star Fire. A nearby volcano was the only source of this fire as a Dwarf Star had once fallen into its core. But since no living being can withstand that heat, Jaga concludes that the sword's powers are thus forever lost.
Unable to accept this horrifying reality, Lion-O runs off towards the volcano and starts climbing it. Tygra and Snarf try to stop him but seeing that Lion-O had completely lost his senses, they hurry back to the Cats Lair to get more help and return shortly with Panthro, Cheetara and Ro-Bear-Bill in the ThunderTank. Ro-Bear Bill leads them to the Enflamer who is the only one who can withstand the volcano's heat and re-forge the sword. However, the Mutants had attacked the Enflamer earlier, draining him of all his fire and only gold can restore his powers.
Panthro and Cheetara head back to the Cats Lair and return with the gold that Cheetara had saved. They dump all the gold into a pit and melt it. The Enflamer crawls into it and disappears. Panthro remembers that he had given Lion-O a locator device to wear and using its signal, he and the rest of the team burrow into the volcano in the ThunderTank and retrieve Lion-O just before he fell into the core.
The Enflamer emergs from the molten gold with his strength fully replenished and flies into the volcano. He then emerges from the crater of the volcano, holding the Sword of Omens which he had re-forged. But he turns against the ThunderCats and starts hurling fireballs at them. Lion-O calls the sword to him and it breaks free of the Enlfamer's hand and returns to its rightful owner. Enraged, the Enflamer starts to blow up the volcano but the ThunderCats manage to outrun the sea of molten lava in the ThunderTank.