The contestants are left puzzled when they're told their next challenge will be designing for one of fashion's most important and stylish icons. They're taken on a field trip to meet the fashion luminary and discover. it's Barbie. Their job is to create a life-sized outfit for the Barbie "My Scene" collection. A day into the challenge, the designers are shocked to discover they must also create a miniature version for the doll. But the extra work has a reward - the winning designer will have their outfit manufactured and sold as part of the "My Scene" line. During the runway show, the judges critique the designers on their vision, and in the end one must go home.

Fashion maven and socialite Nicky Hilton employs the services of the Project Runway designers to make her a party dress. Nicky gives them a day and a half to complete their work and invites them to a trunk-show soiree so that she can check out their dresses. Everyone scrambles to finish and ready themselves for the party where Nicky sizes up their work as well as their social skills. The next day on the runway she bestows her seal of approval on the winner and another designer is sent home.