After their squash game, Niles and Frasier are walking home, with Frasier wearing a pair of Niles shorts as his had split and which look incredibly tight on him. Niles is in a hurry to get him as he said he was at a conference to avoid going to a flower show with Daphne and her mother, but they then see Barry about to pass them and worry that Roz has told him what they thought about him. However, looking up again expecting to meet Barry, the street is deserted. They think he has gone into Bad Billy's, a gay bar, so Frasier decides to go in and confront him leaving Niles outside. The guys inside the bar are obviously interested in a guy wearing very tight shorts, and Frasier is equally surprised to see his French polisher Eduardo serving at the bar. Frasier asks Eduardo if he has seen a guy fitting Barry's description and is told he's in the bathroom, so he decides to wait. Outside, Barry comes out of the house next to Bad Billy's and sees Niles, who then rushes into Bad Billy's and gets Frasier to leave - leaving everyone inside thinking that Frasier has picked up Niles!
The following day on Frasier's show, a caller 'outs' Frasier by telling his listeners that he was at Bad Billy's the previous night, leaving Frasier no choice but to try and explain what he was doing there, but somehow ends up making it worse. This is followed by Gil comforting Frasier on his unexpected 'outing', and a chance encounter with Alistair Burke at Café Nervosa who also heard about his 'outing' and tries to make him feel better about his experience by inviting him to the backstage party for his new play - something that leaves Niles rather envious about. Everyone starts to think that Frasier and Alistair are a pair but Frasier has no idea about it. Frasier gets invited to the party at Alistair's house celebrating his new play and his muse. When he is asked to dance by Alistair, Frasier understands that Alistair looks to him as his better half and tells him that he is straight. Alistair even offers Frasier 3 weeks of holiday with him on Capri in Bertolucci's villa which almost makes Frasier change his mind, but he refuses. Alistair asks him to just pretend to be a pair with him, so that they do not break in front of others to which Frasier agrees.
Frasier: One wonders what's been in Barry’s closet a little too long!
Martin: That guy's not gay! You know how you can tell? The muscles! Niles: Good point dad. Second tip off, no poodle.
Niles: I wonder what kind of place that is? Frasier: Well, let's see - Tuesday is leather night, so it's probably some kind of Shoe companies of the United States... It's a gay bar, you idiot!
Frasier: Excuse me, I'm looking for a guy. Bar Patron: Yeah, I kinda got that from the shorts!
Roz: You know what Barry was doing from 10 o'clock to midnight last night? Frasier: What? Roz: Me, that's what!
Niles: You could have ratted me out to Daphne, but instead you protected me. (sniggering) Just like a big sister should!
Martin: Let’s see - one of my sons just got picked up by a guy, my other son is jealous. Yep - life is good(!)
Frasier: He does not think I’m gay! Niles: He thinks I’m gay, and I'm standing next to my pregnant wife!
Alistair: Is there anything this man can’t do? Niles: Time will tell!