As Max and Michael look for the perfect Christmas tree, they witness a man pushing a little girl out of the way of an oncoming car. As the man is then hit a crowd immediately gather, and Max makes the decision not to save the man's life. Later at home while Isabel, the Christmas Nazi as they call her this time of year, is ranting at the pathetic tree Max picked out, he sees the ghost of the man who was hit sitting across the room. The ghost, John, then questions Max's reasons for not saving his life. Max in turn goes to Liz telling her he needs a friend. The two then talk about why Max didn't save the man, and Max realizes what he needs to do is restore the balance. As the town attends the local Christmas pageant, headed of course by Isabel who reveals she knows what they call her, Maria tells Liz that while caroling she discovered Brody's daughter, Sydney, has terminal cancer. Liz goes to Max with this information, and as Max looks over to Sydney, he gets an idea of how to restore the balance. Max later goes to Brody's house with the intent to heal Sydney, only to discover she's been transferred to a hospital in Arizona.
Still wanting to heal Sydney, Max tells Michael he's going to Arizona and although he doesn't agree with his decision, Michael goes with him in order to keep them out of further trouble. At the hospital, as Michael keeps guard, Max enters the children's ward and heals Sydney. As he's about to leave, he looks around to the other sick children and unable to stop himself, heals child after child until all his powers and energy are drained. Just as the hospital security are about to catch them, Michael runs in and finds an unconscious Max on the floor. We discover they escape through a hospital window, as nurses and security guards come in to find the once sick children, playing, healed. Max later goes to Liz to thank her for telling him about Sydney, and she tells him he can't go on healing people. She explains that maybe someone or something is planning everything that happens and it was Max who once told her that he's not God. Liz then invites Max to midnight services, but he simply leaves her saying Merry Christmas. Later at the Evans home, Michael comes to Max to tell him he wished he could have healed the children Max couldn't get to. He then tells Max he has something he wants to show him. Michael takes Max to Brody's home, where they watch Brody telling Sydney a story. Max then goes to John's house and as the two say goodbye, John tells Max he too should be with the people he loves.
Max is then seen walking into midnight service, and as he passes his family, he sits down next to Liz who turns to him saying she didn't think he believed in God. Max looks to Liz telling her he does believe in her, and as the snow begins to fall, the two look up to the sky holding hands with renewed friendship. Meanwhile, Michael's been torn over what to get Maria for Christmas and Isabel tells him to simply make it something thoughtful. Michael then comes up with the idea of a new bumper for Maria's Jetta, which they keep wrecking, and although she is thrilled with the sentiment, Maria looks to him for her 'real' gift. Michael panics until he realizes Isabel left him something to give to Maria, and as Maria opens the gift, they both discover it's a set of pearl earrings. Maria is ecstatic that Michael would spend so much money on her, but still says the best present she has is him. Over at the Valenti house, Tess has discovered the Sheriff and Kyle don't normally put much celebration into Christmas. She then attempts to bring them all closer by planning a dinner, and inviting Amy DeLuca whom they'd earlier ran into at the grocery store. At dinner, Kyle realizes how much time and thought Tess put into the evening.