Elfman and Evergreen are overwhelmed and defeated by Rustyrose's Arc of Incarnation, which gives him the power to create anything from his imagination. Meanwhile, Loke realizes Caprico is the celestial spirit Capricorn, and that he has the power to take control of humans.

Lucy and Hikaru's battle interrupts Natsu's battle with Ultear, leading Natsu to help Lucy and reform their old team while Ultear leaves with Zeref.