The designers created a dress for a red carpet event, focusing on making a statement about who they are as a designer. Christopher was the winner of the challenge and Ari was the first designer to be eliminated. Guest Judge: Lindsay Lohan.

The designers were taken to the beach, where they were asked to create a fun, surfer-inspired outfit (with an avant-garde companion piece), and were placed in teams of two. Guest Judge: Rachel Bilson.