Both Jade Killer and Master Yuan Kung are hurt in the fight and Jade leaves. Yuan has to receive treatment and hands over his post to Yuan Chueh. Chueh sends the Three Heroes away and they are then captured by Jade Killer. Chueh is the spy sent by Jade Killer and he is told to destroy all the Shaolin kung-fu books. The Shaolin disciples Fang Ming and Fang Chih take the books and run away but Chih is captured. Luk goes to Shaolin and finds that Yuan Chueh has locked Yuan up. Chueh captures Ming and threatens him to yield the kung-fu books in return for Yuan's live. Luk comes to the rescue, kills Chueh and discovers that he is in fact the spy sent by Jade Killer. Luk takes Yuan to Hua Yueh-liu for treatment, and Yuan asks Luk to deal with the Sect but Luk is entangled in the triad love relationship between Tsing, Hua and himself. Shou-ching and Er Mei Sisters suspect Hui Ching and reveals that she is the spy sent by Jade Killer……
