With the help of Mr. Dean, Sister Clodagh and the Sisters of St. Faith run a school at the mysterious palace of Mopu in the Himalayas; but some believe the place is haunted.
As Dilip Rai and Kanchi are discovered together, Clodagh and Ruth clash over Mr. Dean. Meanwhile, all the nuns confront their desires -- with tragic consequences.
Sister Clodagh begins to lose control of the convent. Meanwhile, feelings come to a head between Clodagh, Ruth and Mr. Dean at the Christmas celebration.