Satisfied at Camelot's conditions, Merlin decides to go on a holiday in order to rejuvenate. This vacation nap is supposed to last a few months, but when Merlin awakes, he finds he has slept for fifty years. Upon his return to Camelot, he discovers a downtrodden place. Almost all of those he knew have died; Lord Weston runs the kingdom; and the Holy Grail has departed from the castle. However, Merlin's protective enchantments have held invaders in check. A young thief named Jack and his tagalong pig Sir Snout stowaway in a cart entering Camelot, angering its driver Squire Brian. Jack is no ordinary vagrant, as he possesses some rudimentary magical skills. Jack enters the chamber of Yvonne, granddaughter of Sir Gawain and steals a pendant. Yvonne enters and while Jack hides, Master Graham, a local blacksmith whom she loves, visits her. Jack then attempts to steal Merlin's wand while Merlin concentrates on the whereabouts of the Grail. Merlin senses the visitor, and at first evicts him, but later apprentices Jack after a vision of the Holy Grail appears to both of them.

The remaining people of Camelot have traveled the countryside for several months, seeking the Grail while fleeing their enemy. Jack is frustrated that his concentration does not give him insight, so the Lady of the Lake sends him a vision of the Grail's whereabouts. The group goes there, to discover that the water is cursed and several knights are murdered by a beast attempting to swim to the Grail's cave. Meanwhile, the Lady has told Rauskaug of their location and the barbarians begin their pursuit.