The scene flashes back to a few days ago, when Batman discovers a plan to poison the water at the Health Spring Spa. When he confronts the man drilling into the spa's pipes, the gas douses them both. Later, while he's looking at blueprints on the Batcomputer of a device the man wore, he sees the Joker's reflection. He turns around — it's just Alfred. Realizing something is wrong, Batman heads to the hospital, where the thug is having wild hallucinations. Batman talks to the supervisor, Dr. Wu, who gives him an antidote. However, it will put him to sleep for two days, and Batman can't afford to take that time off before he's solved the case. He heads to Arkham to interrogate the only man who could make such a chemical — the Scarecrow. On the way, he sees Robin in the middle of the road. He swerves and crashes, and the Arkham staff save him and bring him in.
As the hallucinations get worse, Batman is raving incoherently. Thinking he is delusional, psychiatrist Dr. Bartholomew takes him in as a patient. An orderly prepares to remove his mask, but Dr. Bartholomew tells him to leave it for now, as he believes it is the root of Batman's fixation and removing it now might shatter his remaining sanity. They straitjacket Batman and lock him in a cell. He tries to explain Scarecrow's plan to poison Gotham's water supply, but Dr. Bartholomew dismisses this as another delusion, stating that he saw Professor Crane in his cell that morning. Batman's recounting ends.
In the caverns beneath Arkham, which supply Gotham's water, Scarecrow proudly states to his men that he set Batman up. Scarecrow plans to release the fear gas through the water supply to study the effects of mass madness.
Back in his cell, Batman hallucinates his parents in Crime Alley. Dr. Bartholomew arrives after discovering Crane did in fact escape. He still will not release Batman, due to his condition, but promises to alert the police to Professor Crane's location. However, Batman forces his way past the guards and cuts through his straitjacket with a fire axe. A guard tries to tranquilize him, but Batman handcuffs him and forces him to show him to the basement.
As Batman goes through the cavern, still hallucinating, he sees a rat suddenly turn into the Joker. Then the Penguin emerges out of the ground; his head pops to reveal Two-Face, who throws a coin at him which becomes a buzz saw. Two-Face melts into Poison Ivy and soon even Alfred and Robin attack him. Batman falls into an abyss into the mouth of the Scarecrow himself. Finally, he recovers.
He finds the giant pump and faces Scarecrow's thugs, who look like monsters under hallucination. He manages to defeat them and destroy the master console, but Scarecrow foresaw this and installed another one. Batman reaches it but sees the power cord as a snake. He yanks it and destroys the machine, exposing Scarecrow to his own gas.
Imprisoned again, a terrified Jonathan Crane screams and rambles as Dr. Bartholomew tells the guards to make sure Crane stays in his cell. In the Batcave, Bruce takes the antidote, and as he sleeps, a large bat shadow covers him.
Tropes in this episode include:
- Bat Scare: Happens in the cavern when he's going after Scarecrow. Although it's actually a rare example of a good scare, since it snaps him out of his hallucinations and flies further into the cavern, reminding him of the mission.
- Big "NO!": In one of his hallucinations, Batman screams this as a giant gun (representing the gun that killed his parents) shoots at him in a manner reminiscent of a nuclear blast.
- Beware of Hitchhiking Ghosts: The "Apparition in front of the car" variant is used — the Batmobile turns a corner and Batman thinks he's just managed to run Robin down, though in fact it's a hallucination caused by the Scarecrow's fear gas.
- The Dreaded: Downplayed, but Batman's visions suggest that, beneath his stoicism, even he is unnerved by the Joker.
- Dumbass Has a Point: For as naive as Dr. Bartholomew is regarding Arkham's security and Batman's Rogues Gallery in general, once he finally is forced to admit that Scarecrow has managed to escape, he still holds to the fairly reasonable judgment that Batman is no shape to fight him in his currently poisoned condition.
- Earn Your Happy Ending: Bruce Wayne is ready to sleep for two days in the reassuring Batcave after that hard experience.
- Fan Disservice: Ordinarily an appearance from Poison Ivy, this show's biggest Ms. Fanservice, is cause for celebration. But the way her face stretches and distorts in Batman's nightmare is not titillating in the least. Well, unless you're into that sort of thing.
- For Science!: After spending his two previous appearances on, respectively, a Roaring Rampage of Revenge against his former university colleagues and a profit-driven sports-fixing plot, the Scarecrow is now out to use his fear toxin on Gotham to study the effects of widespread fear.
- Genre Blindness: The doctor at Arkham clearly knows so little about how Gotham works that he comes across as astonishingly naïve. He somehow fails to notice that Batman has been drugged despite being a doctor, instead jumping to the conclusion that he's gone insane; he refuses to believe that Scarecrow's Water Source Tampering plot is anything more than a figment of Batman's imagination when such a thing is actually fairly mundane compared to the outlandish schemes Batman usually foils; he somehow feels justified in claiming that Arkham Asylum is effective in treating the various members of Batman's Rogues Gallery; he has so much faith in Arkham's security that he's shocked the Scarecrow managed to escape; and he tells Batman that the police will be able to handle the problem, which is obviously never true in stories like this.
- Go Among Mad People: This happens to Batman, which lets him solve the Scarecrow's plot, but for a time messes up his mind.
- Go-to-Sleep Ending: After a hard battle with Scarecrow, Bruce is finally able to take the antidote administered to him by Alfred, and he wishes Alfred goodnight before drifting off to sleep at the very end of the episode.
- Hoist by His Own Petard: As is par for the course, the Scarecrow ends up driven mad by the same toxin he used on Batman and planned to use on the city.
- How We Got Here: The episode begins with Batman locked up in Arkham Asylum and it spends its first half showing how he ended up there.
- Improvised Weapon: Batman holds off the Scarecrow's goons with little more than a microphone and the ability to whistle off-key.
- In Prison with the Rogues: Batman gets deemed insane and is incarcerated in Arkham Asylum, the very place where his Rogues Gallery is held. It turns out Scarecrow orchestrated the whole thing by exposing Batman to his Fear Gas and having him appear delusional.
- Magic Antidote: Dr. Wu tells Batman that he has made an antidote that can eliminate the fear toxin in his body, but with one side effect: instant drowsiness that can render the antidote taker asleep for two days. Batman, however, decides to put the antidote on hold until he can stop Scarecrow and his evil plans of poisoning the water supply.
- Magic Countdown: A variant of the fast-burning fuse is seen. The Scarecrow has a huge machine mixing fear inducing chemicals to dump in Gotham's water supply. Batman shuts it off, stopping the big clock at 01:45. Scarecrow starts it up with the backup controls and the clock begins counting down again, from 20 seconds. And furthermore, the timer beeps with every passing second, even when it is offscreen, but the beeps don't correspond to how much time has passed. At the 20-second mark, it has plainly beeped more times than there were seconds remaining.
- Might as Well Not Be in Prison at All: Crane is using the cave system under Arkham itself to pull off his plan, and never has to leave the actual facility at all.
- Mind Screw: Scarecrow's new toxin slowly begins to take effect on Batman as the episode goes on, becoming more severe and elaborate until he has a complete breakdown.
- Mythology Gag:
- The Joker's alias from before his transformation is given as "Jack Napier", which was his real name in the Tim Burton movie.
- A hallucinating Batman tries to warn Robin that "Joker's got a bomb".
- Private Eye Monologue: Batman narrates how he ended up in Arkham this way.
- Psychological Horror: This episode wouldn’t feel out of place in the canon of Alfred Hitchcock.
- The Shrink: Dr. Bartholomew of Arkham Asylum genuinely wants to help. But he's naive at best...
- This Is a Drill: Scarecrow's henchman trying to mess up the Health Springs Spa water has a weaponized arm that has one of these.
- With My Hands Tied: Batman is forced to beat up two burly orderlies while in a straitjacket and held for treatment in Arkham.
