Aang struggles to decide whether or not he has to kill the Fire Lord and, during the night, is drawn toward an island which disappears before morning. Zuko leads the rest of the group to the Earth Kingdom to meet a tracker whom they hope can find Aang. The Fire Lord crowns himself Phoenix King and Aang awakens on the island not knowing where he is.

While on the island, Aang seeks guidance from his past lives, but is not pleased with what he is told. The island, in fact, turns out to be a lion turtle from which Aang is given the guidance he had been seeking. After the tracker is unable to track Aang, the rest of the group decide they must find Iroh. Meanwhile, while tracking down Iroh, the group meets up with The Order of the White Lotus, a group that transcends the division of the four nations. After a discussion with Iroh the team decides to split up: Sokka, Suki, and Toph head to stop the Fire Nation's air fleet, the masters head to reclaim Ba Sing Se, and Katara, Zuko, and Appa head to defeat Azula.

Sokka, Suki, and Toph try to stop the Fire Nation's air fleet. Meanwhile, Zuko and Azula duel in an Agni Kai and Aang confronts the Fire Lord. On the verge of losing, Aang gets hit in the back of his scar which sends him into the Avatar State.

Aang defeats the Fire Lord by bending the elements within the Fire Lord and removing his fire bending abilities. After Zuko is taken down protecting Katara from Azula, Katara fights and manages to restrain Azula. Afterwards, Zuko is crowned Fire Lord and promises a better future for the world. Aang takes his place as the next Avatar, changing his attire in the process. Katara finally shows her love for Aang as they kiss in the last scene.