Two-Bit, Johnny, and Ponyboy are at the drive-in movie theater with two Soc girls, Cherry and Marcia. The girls don't have a way home, because they refused to be around their boyfriends while they are drinking alcohol. Two-Bit convinces the girls to let him take them home in his car, but first they need to walk to his house to pick up the car. While they are walking, Cherry and Ponyboy have a discussion about the differences between Socs and greasers.

Cherry says it is because Socs have no feelings about anything. She thinks this is because they have everything they could possibly want, so they are always looking for something to make them happy. Greasers are emotional, they have a different set of morals than Socs. The greasers live a life full of disappointment and depravation. They don't have families which provides them with the emotional and physical support they need, also they feel as if they live life looking at the society from the outside. Cherry feels it is not money, but emotions which set the greasers apart from the Socs.

But, Ponyboy also sees he and Cherry have many things in common, such as they both like to watch the sunrise and they both read books. He opens up to her about his feelings towards Darry. How he feels his brother doesn't want him around and is cold toward him and the world at large.

For some reason Ponyboy feels it is easy to open up to Cherry. He tells her about Soda's horse, Mickey Mouse. The horse actually belonged to another man, but Soda worked at the stables where the horse was boarded. Soda fell in love with the horse and had a special relationship with the horse. The horse wouldn't listen to anyone else but Soda. Soda at this time, when he was 12-years-old, was horse crazy. Then one day the owner sold the horse, breaking Soda's heart.

While the guys are walking with the girls, a blue Mustang drives past, inside are the girls' boyfriends and some of their friends. Johnny becomes very nervous, because it is the same boys who beat him up. After a while the car stops and the boys try to talk the girls into riding home with them. After the two groups of boys start to exchange insults and threaten to fight, the girls decide to ride with them, to prevent a fight. As she leaves, Cherry tells Ponyboy not to talk to her at school, as it can only cause trouble for both of them.

Later that evening Ponyboy and Johnny fall asleep in an empty lot, as they are looking at the stars. After he returns home two hours late, Darry become enraged at Ponyboy's lack of common sense. He slaps Ponyboy in the face, causing Ponyboy to run from the house.

He meets up with Johnny in a vacant lot and the two of them decide to go to the park, so Ponyboy can cool down before returning home. While they talk in the park, the Socs in the blue Mustang find the boys. They decide to make sure Johnny and Ponyboy never talk to a Socs girl again. They force Ponyboy's face into a water fountain and hold him underwater until he can't hold his breath any longer. He loses consciousness and comes to on the ground beside the fountain. He notices Johnny has a sick look on his face. In order to stop Ponyboy from being drowned and to seek revenge for his previous beating, Johnny killed Bob, one of the Socs. He stabbed him in the stomach with his switchblade.

The two boys decide Dally can help them, because he has had many run-ins with the law. They find him at a party at Buck Merril's house. Dally gives them fifty dollars and a loaded gun. He tells them to take the train to Windrixville, from there they are to find an abandoned church on Jay Mountain. It is here they are to hide, until Dally can come and get them. He says he will come as soon as it is safe for him to leave town.

The two boys had just that night thought of running away into the country, because they both wanted to get away from the pressures of family and living as greasers. This is not the way they thought it would be in the country, riding in a freezing box car to get there and then hiding in an old church.

They are so tired they fall asleep right away, once they reach the church. But before they reach the church, they realize the way they look and act will make them highly noticeable in the small town of Windrixville. They know they will need to change their hair and clothes, before they can enter town to buy food to sustain them until Dally arrives.

The thought of hiding out for the rest of his life is unpleasant for Ponyboy, but going to a reformatory is even more unpleasant. He realizes Dally will have to tell Darry and Sodapop what happened and he knows he may never see his brothers again. These are tremendous problems for a boy of fourteen, who lost his parents only eight months before this night.

Johnny, Ponyboy, and Two-Bit meet some Socs girls who are kind to them. They strike up a conversation and begin to understand each other a bit more. Then trouble arrives in a blue Mustang, as the girls' Socs boyfriends spot them walking down the street with the greasers. The Socs leave, but find Johnny and Ponyboy later, in an encounter which leads to the murder of one of the Socs. Ponyboy and Johnny are on the run, after Johnny has murdered one of the Socs. The boys' lives have gone from bad to worse.