Last week's Teen Wolf unveiled the Kanima's master. It is Matt, He is using the monster to get retribution for something that happened to him at a party where his fellow students picked on him.
They threw him in the pool after uncovering his fear of the water. That was despite his warnings he could not swim. Consequently, Matt drowned and died for a few minutes before Isaac's father brought him back to life. Only then he warned Matt not to speak of the incident "or else", which is why no one knew about the incident.
Matt connected with the Kanima after watching Jackson become the creäture the night he'd hoped to film his werewolf transformation. Since the Kanima always seeks a master, Matt assumed that role. Later, he discovered his thoughts transferred to the creäture; thereby allowing him to gain the retribution he sought.
Unfortunately, Matt knew that Scott discovered his connection to the Kanima. So he set out to kill the Teen Wolf.
Back at the police station, Scott's helped Stiles and his sheriff father try to connect Matt and the Kanima using evidence. They pull video tape from the hospital the night Lydia got admitted. Matt was there. He stopped to talk with Scott's mother.
Unfortunately, the discovery comes too late. As they call Mrs. McCall to the station, the Kanima is busy eliminating everyone there with his master's help.
Meanwhile, Derek is recovering from his own attack by the former alpha wolf. The town vet helps him find his way back and recover his strength. That's when he sets out to find Scott.
Unfortunately, the Kanima finds him first and paralyzes him with a scratch of his nail. It is his figure that Scott sees when he opens the door to the police station. Unfortunately, Derek falls forward to unveil Matt standing behind him with a gun.
Matt demands the proof of his involvement with the Kanima be erased. Otherwise, he promises to kill everyone. Still, once that's done he has the Kanima paralyze Stiles and he throws sheriff into one of his own cells. Then he and Scott wait for Scott's mother to arrive.
When she gets there, Scott jumps forward to protect her. Matt shoots the teen in the stomach. Thinking her son is dying, Mrs. McCall promises to do anything to save her son. But Matt throws her into a cell as well.
Elsewhere, Gerard presents a note to Allison that her mother wrote for her before committing suicide. He makes the teen promise that she'll burn it after reading the message. Allison agrees and does just as she told.
What the note contained isn't revealed, but whatever it was changes Allison's outlook on things. She grabs her crossbow and helps her father and grandfather plan an attack on Derek.
They arrive at the jail in the middle of everything. They use gas to try to immobilize the enemy. It only partially works. However, it's enough to gain Scott an advantage. He breaks free from Matt.
Elsewhere, Derek fights to bring himself out of the paralysis. Once he does, he takes on the Kanima in front of Scott's mother and everyone else. When Scott jumps in to help, he reveals his true self as well. His mother's horrified to find out her son is a werewolf.
As Allison moves in after Derek, she encounters the Kanima instead. She shoots an arrow into his head. It doesn't stop the creäture. He just takes it out and goes for her. She keeps shooting, but her arrows do no good. Finally, she makes a run for it with the Kanima on her tail.
He gets stopped, however, by his master Matt. But after he's already paralyzed Allison. Matt tells her if he can't have her, no one can. Then a noise in the alley alerts him. He goes to check it out just as Allison's father moves in to save his daughter.
Gerard, now certain of what to do to gain control of the Kanima, drowns its master -- Matt. As the boys dies, his connection with the creäture gets severed. But Gerard begins a new one by linking hands with the enemy.