The death of a local mob figure, Patrick "Patty" Mullin, allows for the return of Michael Caffee to "The Hill" neighborhood in Providence, RI. Caffee had been in hiding for seven years after the man vowed to kill him. Upon returning he begins to reassume his old criminal business alongside his friend Pete McConagle. Michael's boss Freddie Cork tries to blackmail Michael's politican brother Tommy Caffee into assigning him lucrative contracts with a threat to kill Michael. Tommy refuses to be swayed and tells Freddie that he does not care about Michael. Michael manages to arrange a temporary truce with Freddie. Eileen Caffee is cheating on her husband Tommy with Carl Hobbs and is also concealing drug use from her family.
Michael takes over a local store with threats. Tommy diffuses the owners intentions to press charges by passing her on to Declan Giggs, an officer who was once friends with the Caffees. Giggs tells her it is too dangerous to testify against the Irish gangs. Michael also takes over a local bar named Mulligans. He rekindles his relationship with Kath Parry and realises how much she cares for him when she stands by him through a shoot out with Russian mobsters.
Tommy turns to Judd for help in preventing a highway being built through "The Hill" and is forced to give up more of his independence. Carl ends his relationship with Eileen. Treasury agents raid Rose Caffee's residence looking for counterfeit money belonging to Michael. They are unsuccesful but the scandal costs Tommy further political capital and he pledges his loyalty to the speaker of the house. Tommy uses his political influence to turn a profit, but is outraged when he finds the speaker of the house stealing.[13][14] Tommy maneuvers his way to the house majority leader position.
Michael helps Declan dispose of a body after Declan's partner unwitingly shoots an undercover FBI agent. Eileen's drug use intensifies and she is arrested for erratic behaviour; Pete also gives in to his addiction and Michael takes him to alcoholics anonymous. Tommy's eldest daughter Mary Rose is caught trying some of her mothers drugs by Michael and he gives her a job in his store to keep an eye on her.[19][20] Pete and Eileen realise their common ground.
A bus crash on the way back from a football game leaves several residents of "The Hill" dead. The accident was caused by the suicide of Freddie Cork's son who was homosexual. Michael uses this information to manipulate Freddie. Freddie pressures Tommy into ensuring that his son receives a Catholic burial. Carl is also killed and Eileen resolves to atone for her sins. Marty Trio's wife is also killed and he finally decides to work with the police.
Neil Caffee arrives in town and Michael and Tommy form an uneasy alliance to get rid of their father. Rose confronts Michael about how he makes his living. Tommy discovers that his daughter has been working for Michael ending their period of co-operation.[23][24] Everyone in "The Hill" attends a big Irish wedding, as Tommy Caffee tries to avoid a legal trap set up by an ambitious U.S. Attorney, who has promised him immunity if he will testify about Michael's dealing with Freddie. He must also protect his brother from being whacked by Moe Riley, who has been released from prison and is out for revenge. Declan finds his partner may be a dirty cop and must decide where his loyalty lies. He blames Michael for making him "go bad" and attacks him.