Derek returns to Beacon Hills in search of his sister, Laura, who had previously come back to investigate a revenge symbol painted on a deer. He is largely concerned with keeping people from being hurt, which mostly involves trying to stop Scott from inadvertently killing people while tracking down the Alpha.
He discovers Scott and Stiles trespassing on Hale House property in the Beacon Hills Preserve and tells them to leave, returning Scott's lost inhaler to him. He's aware that Scott is now a werewolf and takes it upon himself to keep an eye on him and try to help him control his new abilities.
When Scott nearly shifts at a party, Derek is there to take Allison home. He also steals her jacket and uses it to lure Scott out in the woods, so they can have a talk about how dangerous it is for Scott to try to have a girlfriend. They are attacked by hunters while they're out there and Derek saves Scott. Once they've escaped, he tells him that they're brothers now.
Derek continues to keep an eye on Scott, showing up again after Scott partially shifts on the lacrosse field and injures Jackson. He doesn't intervene when Scott fully shifts and attacks Stiles in the locker room, but he does follow him home. He threatens Scott for shifting in front of other people, because it will bring out the townspeople with pitchforks. Derek tells him that he's not allowed to play in his next lacrosse game because he can't control himself.
The following day, Derek secretly returns Allison's jacket to her and watches her from down the hall.
Scott confronts Derek at the Hale House after learning that he returned Allison's jacket. Derek vaguely tries to tell him that the Argents can't be trusted and then slashes Scott's lacrosse stick to try to keep him from playing. He insists that Scott will lose everything if people find out what he is. Derek is speaking from experience as this is what happened to him when he trusted the wrong person with his secret.
When Scott and Stiles discover Laura's body buried next to the house, they assume that Derek is the killer and have him arrested. Stiles confronts Derek in the police cruiser, but Derek just warns him that Scott is dangerous and needs to forget about the game. He puts it on Stiles to make sure that no one gets hurt. The police eventually have to let Derek go because the medical examiner determines that Laura was killed by an animal, not a human.
After a disturbing dream, Scott seeks out Derek for help in controlling his shifts. He thinks he might have killed someone in his sleep. Derek tells him that he didn't and offers him advice on how to recover lost memories by letting his enhanced senses take over. Scott follows his instructions, but it only serves to turn Scott further against him as Scott believes Derek was the other werewolf from his memories.
Chris Argent and his hunters find Derek filling up at a gas station and stop to threaten him. Chris compliments him on the Camaro, informing him that he's very protective of the things he loves. Derek controls his anger, but doesn't let the hunters go without a snarky comment. Chris responds by breaking one of the Camaro's windows.
Derek goes to see Garrison Meyers, the bus driver, in the hospital to find out what he knows about the attack. Garrison recognizes him and apologizes, much to Derek's confusion, and dies before he's able to tell him anything more. When Scott learns that Garrison died, he rushes to the Hale House for a fight. Derek insists that he didn't kill him, but Scott won't believe him. Scott insists on fighting, which Derek puts an end to as quickly as he can. Scott accuses him of turning him into a werewolf, but Derek explains to him that there's a third werewolf, an alpha.
Derek finally gets a lead on the Alpha and is chasing him through the warehouse district when he's shot in the arm by Kate Argent. The bullet is filled with wolfsbane, and Derek can't heal while the wound is poisoned. He heads to the high school looking for Scott. He finds Jackson, who thinks Derek is Scott's drug dealer, and accidentally embed his claws into Jackson's neck when Jackson manhandles him. Despite his illness, Derek is initially civil and only reacts violently to Jackson when provoked. Eventually, Derek hears Allison say that Scott will be at her house later. He goes out to the parking lot and collapses in front of Stiles's Jeep. Scott runs to see what's wrong and tells him that he has 48 hours to live.
Scott telling him that it was a woman who shot him is where Derek likely realizes that Kate is back in town as she is the only female Argent he knows of who hunts. His eyes flash blue as he looks extra pained and upset in what is likely to be a PTSD response to her presence.
Derek gets in the Jeep with Stiles, much to Stiles' dismay, and they drive off. At first, Derek doesn't know where Stiles is taking him, but he objects when he learns that Stiles was going to return him to the Hale House in his weakened state. Stiles pulls the car over to argue about it and Derek threatens him. It's enough to make Stiles agree and they head toward the Animal Clinic instead. Stiles continually updates Scott on Derek's deteriorating condition. Once at the clinic, Derek tells Stiles that he will have to cut off his arm if Scott doesn't come back with a cure in time. Stiles doesn't want to and claims that he's not afraid of Derek's threats anymore, but he agrees to do it after Derek hauls him half over the exam table.
Stiles is about to turn on the saw when Scott arrives with the bullet, but Derek passes out while trying to explain what he needs to do with it. Stiles tries to slap him back to consciousness and, when that fails, punches him awake then helps him up. Derek burns the wolfsbane to ash and then presses it into the wound. He falls on the floor in pain, but the infection clears up almost instantly. When Scott tries to end their association, claiming that the Argents are nicer than him, Derek brings him to see his comatose uncle, Peter, who was burned in the fire as proof that the Argents are hostile and extremely dangerous. It's the most open Derek has been about having an emotional inner life thus far.
After that night, Derek and Scott try looking for the Alpha together. Scott asks him if werewolves are always killers and Derek tells him that they don't have to be, that they're predators. He isn't sure why this alpha is, either. He tries to tell Scott that pain keeps him from shifting, as he sees it as the common denominator in all the instances in which Scott was able to control his transformations.
He confronts Jackson in the boys locker room, looking for information on the Alpha's attack in the video store. Jackson pretends not to be afraid of Derek, but he's terrified. So terrified that Derek has to get him to calm down just to tell if he's lying.
Derek goes back to the Hale House and is working out when Kate and some hunters bust in. She hits him with an electrified baton that leaves him unable to move. She makes comments about how hot he is while he's writhing in pain and then follows him as he tries to crawl away. She slides up to his ear and tells him that they didn't kill Laura. She wants to know who the Alpha is but figures out from his silence that he doesn't know either. Derek manages to recover enough from the electric shocks to run away before Kate can shoot him.
This interaction, like all of his with Kate, is defined by Kate's sexual aggression and Derek's objectification and helplessness.
Derek attacks Scott in a parking garage just to see what Scott will do. Derek admits that he's never tried to train someone who's been bitten before and isn't sure that he can. Being a born werewolf is different. Derek insists that Allison is a dangerous distraction, though, and breaks Scott's phone when Scott won't accept this. He must follow Scott after that, because he's aware that the Alpha visits Scott after spending some time with Allison.
Derek lets himself into Scott's room and sits in the chair next to his bed waiting for him to get home. He questions Scott about the Alpha, telling him to trust his senses. Scott reveals that the Alpha drew a spiral and Derek suddenly decides to leave. He doesn't tell Scott what the symbol means. As a last resort, Derek goes to see Peter and begs him for help. He's all alone and doesn't know what to do, so he asks Peter for a sign that he's in there somewhere. When he doesn't get one, he yells at him and leaves in frustration. Outside, there's a note on Derek's car with a photo of the deer with the spiral on its side. This photo leads Derek to Alan Deaton, who he believes to be the Alpha.
Derek starts roughing Deaton up and only stops when Scott arrives and intervenes. Derek backs off in the face of Scott's anger but doesn't give up his belief that Deaton is their guy. He agrees to meet Scott and Stiles at the school in an hour and packs Deaton up in the back of his car. At the school, he waits to see what their plan is and nearly rolls his eyes out of his head when Scott first attempts to roar into the PA system. Scott gives it another try, though, and Derek is actually impressed with the howl. When the boys come out, he yells at them for their idiocy because the howl could be heard around the whole town. The plan works, however, and the Alpha appears. It shoves its claws through Derek's back and hurls him at the school. He appears dead.
Sometime during the night, Derek recovers enough to get in his car and escape while the teens are still dealing with the alpha. Scott thinks he's dead, though, and pins all the murders in town on him. This launches a full scale manhunt and makes Derek the most wanted man in California. He hides out for a while and only appears when Scott is about to kill Allison and Jackson on the night of the full moon. While Scott tries to fight him, Derek keeps tossing him aside, pointedly not using aggressive fighting tactics against him. He breaks through Scott's bloodlust by roaring in his face and then takes Scott home. When Scott thanks him, he looks uncomfortable and turns to leave, but Scott asks him if there's a cure. Derek tells him that it's just a legend, but if he kills the Alpha who made him it might break the curse. Derek again asks for Scott's help in finding the Alpha.
Derek's search for the Alpha leads him to Mr. Adrian Harris and he arrives just in time to keep Harris from being killed by the murderous werewolf. The police are chasing him, though, and Derek runs from both them and the Argents through the Ironworks. Scott and Stiles are helping him and swing by in the Camaro to pick him up before Chris can put an arrow through him. Derek tells them about Harris and about the pendant that Laura had a sketch of. Somehow the Alpha is related to these things.
Because he's wanted by the police, Derek decides to hide in the bedroom of the sheriff's son, the last place they'd look for him. Stiles is stunned to see him standing in the corner and has to cover for him because his father is right outside in the hallway. Derek shoves Stiles against the wall and warns him about giving him away, but Stiles stands up to him because it is his house after all. Derek accepts him as an equal as they straighten each others jackets and decides to trust him, but not without playfully scaring him one last time. Stiles reveals that he has an idea about how they can find the Alpha. The text that Allison got wasn't from Scott, so if they can track down the source they can find him. This requires Danny's help. Derek sits quietly in a chair by Stiles' bed reading as Danny comes in. He glares when Stiles calls him Miguel in an unconvincing lie, making it seem like he's Stiles' secret boyfriend, and glares more when Stiles suggests that he change his shirt. None of Stiles' shirts are big enough. Stiles realizes that Danny is enjoying Derek's physique and uses this to get his help. Derek is aware that he's being used as a sex object and complies with the plan although he is visibly upset about it.
They find the source of the text at the hospital and go to check it out. Derek overhears Stiles telling Scott that he's going to miss the first lacrosse game he ever got a chance to play in and he briefly gives Stiles a wondering look, amazed that he would give up something important to him and his dad in order to help Derek. However, he does punish Stiles for using him as a sex object earlier and then orders him to go in and investigate. When Stiles reports that Peter's room is empty, Derek realizes that Peter is the Alpha and yells at him to run. Then he rushes into the hospital himself to save Stiles and confront Peter.
Peter wins the fight and Derek listens to his reasons for killing people. He's torn between a desire for revenge and his moral code against murder, but he believes Peter's story about not being in control of himself when he killed Laura.
Derek continues to be torn about the side he has chosen when they confront Scott in the boys locker room and ask him to join them.
While Peter is trying to deal with Scott, Derek deals with Jackson. He tells him he'll make him a werewolf and then brings him to the Hale House to scare him away from being involved by pretending to want to kill him. Scott intervenes, but so do the hunters. Derek sacrifices himself to the hunters so that Scott and Jackson can escape, but not before stealing Scott's phone so that the GPS can be tracked later. As he had seen Stiles pull off one trick with tracking down phones, he believes that Stiles will figure out what he's done and do a trace to rescue him.
He finds himself chained up in a dungeon beneath the Hale House at Kate's mercy. Over several days, Kate tortures him with electricity and physical beating. He is silent most of the time. His strongest reaction is when she licks his stomach. This appears to be a PTSD trigger for him, as he both reacts violently and is left excessively panicked afterward. She nearly makes him cry when she tells him that he's helping her destroy his pack a second time.
Derek is weak from his torture when he hears Scott howl, looking for him. He works up enough strength to respond, which allows Scott to find him. They manage to knock out the hunter that's been beating Derek, but when Derek asks Scott to unchain him, Scott hesitates. He wants a promise that Derek will help him stop Peter. Derek can't believe that Scott is attempting to blackmail him when Kate could return at any time, but Scott insists. He then shows Derek the photo of the deer with the revenge spiral and explains that Peter's nurse went to Deaton to get a copy and claims Peter lured Laura to him in order to kill her. The betrayal angers Derek enough that he busts the chains on his own and agrees to help Scott.
As they're trying to escape, they are attacked by Allison and Kate. Allison shoots Derek twice and then blinds Scott with a flash bomb. Weak and shot, Derek tries to save Scott, hauling him to his feet and throwing him toward the house even when he's unable to follow. Kate shoots him and leaves him for dead, although he's well enough to confront Peter a few minutes later. After the teens take Peter down, Derek approaches him in order to deliver the finishing blow. Scott notices and protests, believing he'll lose his chance to be cured. Derek seems to consider this, but knows that it would more likely make Scott an alpha and end in disaster. At Peter's goading, Derek slashes his throat and stands to show that he is now the alpha.
Later, Jackson finds Derek and again asks for the bite. This time Derek gives in and bites him.