Having mourned Buddy’s death for 3 months, Angel returns back to the gang, now with Fred among them. He also has to battle a lovelorn vampire, whose paramour Angel dusted. Meanwhile Cordelia’s visions are taking a huge toll on her health. Turns out that Lilah, with the help of a man with a huge brain is causing the problems for Cordy by sending powerful visions her way. Angel has to free a man who is being held in a fire ball as punishment for his evil ways and hand him over to Wolfram & Hart in exchange for Cordy’s health. As soon as that is done, Angel kills the huge brain man. Gunn then meets up with his old street gang mates who look down on him a bit because he has joined alliances with a vampire. Led by a new guy who keeps insulting Gunn, the street gang invade Caritas and hold Wesley, Lorne, Cordy & Fred captive and kill a few demons. In the ensuing fight, the new guy is killed by a demon in the now wrecked bar. Angel also is trapped in an old man’s body, who uses Angel’s body to romance the ladies, until the rest of them can break the spell and reverse it.
Then Fred’s parents come in search of her and she is convinced that she can’t stay with the gang in the hotel since she isn’t like them. But when Fred finds out why some cockroach demons were attacking the hotel and solves it, she convinces her folks that she belongs with Angel Investigations now. The man that Angel rescued from the fire ball cage, Billy, is next seen causing trouble wherever he goes. His touch incites men to turn into women beaters & killers, Lilah herself the victim of one such attach. Billy is later confronted by Angel & Cordy and in the end is killed by Lilah. As the group relaxes in the hotel, suddenly Darla appears – pregnant with Angel’s child. The rest of the group, Cordy especially is shocked and they try to help Darla.
While this is taking place, Angelus’s old nemesis, Holtz is brought to the 21st century by a demon, Sahjhan, who holds a grudge against Angelus. Despite Angel being good, Holtz wants revenge for Angelus killing his family. Now with the unprecedented impending birth of an offspring of two vampires, Darla is getting a lot of unwanted attention. Demons, vampire cults & Wolfram & Hart all want a piece of her baby. While they try to escape, Angel is caught by Holtz, introducing himself as a new threat. He escapes and meets up with the gang at Caritas but Holtz is ready for them. In the ensuing fight, the gang try to break away but Darla knows that she has to deliver the baby now; the child is dying as the vampire body is unfit to house a living baby. The baby has a soul and is affecting Darla, so she does the first selfless act in ages and stakes herself, leaving only dust and a baby boy.
Holtz lets Angel escape with the baby and although the demon protests, Holtz has a new plan. He starts recruiting humans who have a grudge against vampires, the foremost of them being Justine, whose twin was killed by a vampire. Meanwhile Angel struggles with the role of being a dad and the gang helps. They take on lots of new cases, after advertising like crazy. In one case, a group of demons almost behead Fred and attach it to their leader’s neck, thinking that her brain will be perfect for the sect.
Cordelia’s gets a near death experience on her birthday; after she has a vision, her soul gets thrown out of her body while lies in a vegetative state. The demon Skip is the only one who can see her and her offers her a different life, without the visions and one in which she is a tv star. However, she later choses to go back to the gang, and Skip turns her into a half demon in order for her to be able to safely continue to have the visions. Angel starts having feelings for Cordelia but that is thwarted by the arrival of Groosalug. All this while Fred & Gunn have begun a romantic relationship, much to the dismay of Wesley, who has feelings for Fred. When Cordy & Gru go on a vacation, Holtz springs his plan into action; Wesley is deceived into thinking that there is a prophecy that states that Angel will kill his son. Scared for the boy he kidnaps the baby.
Justine tricks Wesley and slices his throat and runs off with the baby to Holtz, who escapes with the kid, Connor to a hell dimension. A distraught Angel can only look on in sadness, as he cannot do anything. Holtz promises to love Connor as his own. Wesley is rescued and brought to a hospital but Angel is furious with him and threatens to kill him for his betrayal. A lonely and slowly recovering Wesley begins a sexual affair with Lilah, although neither trusts the other. Angel is slowly getting used to the idea of never seeing his son, when a portal opens and a teenaged Connor comes through and fights off all the men. Connor try to beat Angel but they begin to get a little close. However, this is all part of Holtz’s plan; get Angel close to his son once again and then he gets Justine to kill him but stages it as if Angel killed him. Connor is wild and with Justine’s help captures Angel and puts him a metal coffin, from which Angel cannot escape and sinks him to the bottom of the ocean. Gru leaves LA, when he realizes that Cordy actually loves Angel and when Cordy rushes to meet with Angel, Skip comes to her and tells her that she has been chosen to become a higher being. Cordy finally accepts and is lifted into another plane of existence.