The crew plays host to a group of visiting interplanetary dignitaries who are negotiating for the rights to a stable wormhole to the Gamma Quadrant discovered by the Barzan, which could provide a valuable and efficient "bypass" through known space. Deanna Troi, overwhelmed by her duties as ship's counselor, reluctantly agrees to attend the delegations' reception. She meets Devinoni Ral, secretly a fellow empath and negotiator for one of the groups. Ral and Troi fall into an instant, passionate affair.
Meanwhile, talks over the rights to the wormhole are coming to a boiling point. Resolved to achieve success and take over the rights, the Ferengi incapacitate the Federation representative, Seth Mendoza. Captain Jean-Luc Picard selects First Officer William Riker to replace Mendoza in representing the Federation's interests. Riker recommends that the USS Enterprise conduct an exploratory expedition into it before committing the Federation to a binding contract. Picard agrees and orders Chief Engineer La Forge and Second Officer Data to take a shuttlecraft into the wormhole. In an effort to prevent being outdone, the Ferengi send in a shuttle of their own. The two crafts are surprised to find themselves in the Delta Quadrant, and as they monitor the wormhole, La Forge and Data agree that while the other end of the wormhole may be stable, this end is not, making the wormhole worthless. Further, they detect signs that this end of the wormhole may move soon. The two try to warn the Ferengi about this before they return through it, but the two Ferengi remain steadfast. The Ferengi are shocked when the wormhole vanishes in front from them, stranding them in the Delta Quadrant.
Meanwhile, on the Enterprise, negotiations for the wormhole continue, as well as the sparks between Troi and Ral. Even though she has fallen for Ral, Troi starts to have some second thoughts about him when he tells her in intimate confidence that he is part Betazoid and that he has been using his empathic abilities to manipulate the opposing delegates in the negotiations.
Ral deftly narrows the competition down to the Federation and his own employers, the Chrysalians. Just before Riker can obtain the wormhole rights, the Ferengi threaten to destroy the wormhole, claiming that an "informed source" has told them that the Federation has made a covert pact with the Barzan premier. Picard requests Riker's presence on the bridge to deal with the situation; in his absence, Ral takes the advantage, and builds his case on the Barzan leader's wishes for peace to win the claim to the wormhole for his group. When Troi realizes that Devinoni staged the entire altercation to sabotage the Federation, her sense of duty forces her to betray his trust and speak out publicly. But before the Barzan premier has a chance to cancel the bargain with Ral and the Chrysalians, the Enterprise shuttle emerges from the wormhole and hails the ship, announcing that it is worthless. Ral then says goodbye to Troi and returns to face his employers.