In the TARDIS, the Doctor turns off the air and gravity inside the ship after he and Rose seal themselves in spacesuits to get ready to visit the Moon. However, when Rose jumps out of the TARDIS she falls down in a quite ordinary way; smashing into a wooden table. After looking around, she concludes that they had landed on Earth in a bar. She finds a newspaper and whilst checking the news discovers an article about the discovery of ancient Roman remains and a mosaic that depicted a disturbingly familiar pepper pot shape. Worried, she runs for the TARDIS but the door slams shut in her face and then leaves her standing alone as it dematerialises.
Elsewhere, a girl named Kate Yates begins to wake up as the radio switches on, but falls asleep again and wakes up an hour and a half later. She gets out of bed and hurries to get ready for work, before setting off to catch the bus, whilst thinking about her various problems; such as how she had tried to live in a big city on her own but had come back to the village she once lived in with big debts to pay. Most of all she thinks about how much trouble she will be in with her boss Serena for being late.
Rose climbs out of her spacesuit, wondering why the Doctor has gone away without her. She concludes that it must be connected to the Dalek she has seen in the mosaic and then goes to have a look around outside at the village. She sits on a bench looking at her TARDIS key waiting for it to glow; indicating that the ship is coming back for her.
Kate runs to catch the bus but while she is in the middle of the road a sport car zooms round the corner and smashes into her. As she falls to the ground; she knows that she is about to die.
Rose hears the smack of metal on flesh and runs to see Kate dying on the ground, before trying to see if it was possible to rescue her. She holds her hand but stings her so she draws back. Kate's back arches and an aura spreads out from the wound of the crash and covers her entire body. It suddenly disappears leaving Kate perfectly all right, only with her hair having turned from red to blonde.
When the TARDIS materializes again after taking off without his intervention, the Doctor goes out to check where he has been brought and discovers that he was in a nuclear bunker. He hears the distant tones of a radio and decides to go and see who is listening to it.
Frank Openshaw is checking the archaeological dig that uncovered the ancient Roman remains when someone asks him for access to the phone; a strange man in a pinstripe suit too old to be one of the students working on the excavation. Frank warns him that there is no signal deep underground but the man connects a strange tubular tool to the phone, dials and seems to get through. He hears the voice of a woman talking to man and after a brief conversation the man hangs up and starts watching the progressing dig, showing a great knowledge of Roman history. Frank manages to interrupt him to ask for his name and the man answers that he is just the Doctor. He asks him if by any chance they have dug up anything they didn't really understand and Frank points down a corridor where there is a mosaic. As he thinks about the strange situation he has entered into, one of the students calls him warning him that they had found something very weird.
The Doctor goes along the corridor and when he sees the mosaic his heart skips a bit. He hears the students call to Frank he goes back, jumps down into the pit where they have been digging and warns the students to back off from the Dalek they had found. The students begin to get very excited but the Doctor tells them that it is a bomb and they must evacuate, and is supported in his claims by Frank supported by Frank.
Meanwhile, Kate talks to Serena at the phone and gets angry because her boss doesn’t believe that she was almost run over. After entering a teashop she looks at a newspaper and glances at the puzzle page. She realizes that the games look very easy, despite the fact she has never been good at them. When she looks up she notices that the girl who had helped her on the road, Rose, has just entered the shop. She is annoyed when Rose goes to her and asks her questions she doesn’t want to answer so she asks her to leave, not interested in her company and curiosity.
Frank watches the Doctor open the object he has described as a bomb and when he does sot they notice that there is an empty space within it. The Doctor looks relieved and when Frank manifests his puzzlement the Time Lord explains the nature and the origin of Daleks. However, the old man believes that the Doctor is joking.
Rose doesn’t give up and asks Kate to go with her and meet the Doctor. Something in Kate's mind reacts to that name and she accepts, so they set off to catch the bus to find him. Strange thoughts start crossing Kate's mind, as if they were somebody else's memories, images of other worlds and the echo of the word Doctor, then a word starts running through her head endlessly: exterminate!
Slowly the Doctor removes the gun instrument from the Dalek and gives it to Frank. He comments that Frank doesn’t ask questions about travelling in time and changing history and the old man replies by admitting that if he could travel in time, there's one thing he'd like to change. It would be meeting his wife Sandra earlier in his life so as to spend more time with her, back when the both of them were attending Durham University. In the true course of event however, it would be ten years before they met. The Doctor asks Frank to bring the gun back home with him and promises that he'll come to pick it up in the evening, after dismantling the Dalek for safety.
Rose and Kate arrive at the digging site and eventually find the Doctor. Kate begins to wonder about her new sense of cunning when she realizes that the Doctor is dangerous and she needs to play a game with her new asset.
Rose and the Doctor talk about the Dalek, how it must have arrived on Earth and how to get rid of it for good. Rose tries to talk to the Doctor about Kate but he is more interested in the Dalek. Kate has never heard the word ‘Dalek’ before yet it causes a strange satisfaction inside her. She gets closer to the Dalek and reaches into the mass of electronic connections inside. The Doctor turns and realizes that tiny glowing filaments are flowing from her fingertips and into the empty Dalek casing.
He knocks Kate down and asks Rose to tell him everything she knows about her, and after she tells him about the accident and her apparent regeneration, he is convinced that Kate was the result of a Daleks attempt to imprint their factor in the human race that for some reason only now has emerged in true form, having been injected many years ago when it landed in Rome. He decides that it will be better for everyone if Rose took Kate somewhere else, away from the casing and when he goes to check the Dalek again, so as to resume his task of dismantling it, he realizes that a little Dalek creature has been born inside, and is reaching out to take hold of the various controls housed around it. The Dalek’s lights come into life and the Doctor realizes that it is time to run. He takes the lift but the Dalek follows him and starts dragging it back down.
The Doctor manages to open the service hatch on the lift’s ceiling and jumps out of the cabin then he starts climbing the steel cable outside. When he gets out of the lift shaft he discovers that several police cars are arriving. The cops ask him to identify himself despite the urgency he is in and in the elapsing time the Dalek reaches them and starts pulling the police cars around with its sucker arm; destroying them and causing total chaos. The Doctor yells at the Dalek in order to distract it and when he finally gets its attention he introduces himself. The Dalek recognizes its race's archenemy and when the Doctor runs away it follows him.
A lorry stops and picks up Rose and Kate as the young traveller tries to get the young woman as far away from the Dalek as possible. Once inside, Kate feels torn into two people; with the Dalek part trying to force her to hate all the humans. Despite Rose’s attempts to calm her down she feels a growing anger towards mankind, willing to exterminate her ex boyfriend who had spent all her money and left her in debt. Suddenly Kate grabs the wheel of the lorry and twists it violently, forcing the driver to jump on the breaks. Rose tries to stop her but Kate manages to jump out of the vehicle, leaving Rose to follow her.
The Doctor manages to reach a crane nearby in the scrap yard where the dig took place. He jumps into the cab and when the Dalek gets close enough he throws a brick on its eyestalk, blinding it. Taking advantage of the situation the Doctor activates the half-ton wrecking ball attached to the crane to hit the Dalek, throwing it into a nearby stretch of water. He then jumps out of the cab to go and finish his job of dismantling the creature but when he activates the sonic screwdriver an electrical discharge stuns him and the Dalek glides away.
Kate arrives at the market where she works and confronts her boss Serena. Kate tries to choke her with her bare hands but Rose arrives just in time to stop her, appealing to her human side. Meanwhile, the Doctor wakes up in the water, the Dalek now out of sight, and realizes it wants its gun back.
Frank is going home on a train; thinking about the story he will tell his wife in regards to his day at the dig and the alien gun he has acquired, but is interrupted when the Dalek attacks the locomotive. When it finds Frank it forces him to reattach the gun threatening by another passenger with its sucker arm. When Frank has reattached the gun the Dalek decides to test it on him.
Police officers arrive at the market to check what was happening with Kate. Rose tries to convince them that the girl just needs to go to a hospital very far away when the Dalek arrives, looking for Kate. The girl reaches it and this time her human side is too overwhelmed for any of Rose's words to reach out to her so she tells the Dalek that Rose is the Doctor's companion and it decides to exterminate her as an act against his nemesis. However, before it can carry out the act, the TARDIS materializes in the market and the Doctor appears from within, daring the Dalek to exterminate him.
The Doctor knows that the Dalek's knowledge is out of date and it wants an update from him so for the moment it won't kill him. Exploiting the Dalek's need for information the Doctor convinces it to tell him about its race's biological influence on humans and the Dalek explains the its race sent a capsule back to Earth in the past to spread the Dalek factor among humans to create back-up from raw matter but it was hit during the Time War so it could spread just a little bit of Dalek factor, which was triggered when the digging disturbed the Dalek who felt in the past.
The Dalek offers the Doctor a deal: it’ll spare the Earth in from biological mutation in exchange for a means of travel in space and time to find a new planet on which to give birth to a new Dalek race. Rose points out that the new Daleks would destroy other planets but despite her words, the Doctor accepts the deal.
The Doctor and Rose return to the TARDIS where the Doctor finds an old Time Ring, a sort of personal TARDIS, which the Dalek can use to find a new place to settle, still willing to go on with the deal despite Rose's objections.
After the Dalek is given the Time Ring he tells Kate to set the coordinates as the device was made to be operated by a humanoid figure. Rose begs Kate's human side not to do so but it is of no use; she operates the Time Ring. After the set-up is completed the Dalek states that he will exterminate the Doctor anyway but when it fires, a sphere of light forms around it: Kate has activated the Time Ring. She is torn between her human side and the Dalek factor but eventually her true self wins and she announces she has activated the Time Ring to self-destruct. The Doctor grabs Kate and Rose, pulls them into the TARDIS, and dematerialises whilst outside, the Dalek implodes.
With the destruction of the Dalek, Kate has returned to full human mentality, with her original red hair. She begins to become confused by the anomaly of the TARDIS interior as the Doctor asks her what he could do for her in return for her services to them. Rose asks her if she has her credit card with her so Kate asks if he could pay off her debts. The Doctor runs the sonic screwdriver along the magnetic strip of the card and announces that her debts are gone, but warns her that he has battered her credit rating forever so she shouldn't even try to apply for another one. Kate remembers that she has tried to kill her boss but the Doctor points out that it was a natural blonde who had attacked Serena, not a redhead, so it couldn't have been her.
When she arrives home, Kate ponders that with all her debts gone she could start a new life, before walking back into the every day world.
It is a sunny afternoon in summer of 1970 at Durham University. Frank Openshaw is on his way to his next history lecture when he sees a gorgeous third year but he knows he doesn’t stand a chance at wooing her. Suddenly a blonde girl crashes into him with a bicycle and whilst the girl is apologizes for the incident the third year rushes to help him and they start talking while the girl on the bike cycles away.
Rose reaches the TARDIS on her bike whilst the Doctor looks at Frank and his new friend Sandra walking away together, confirming that Rose has done well. After Rose asks why he asked her to do such a thing he states that he is bending the rules for a friend.