So, thanks to Katherine, we find out that Stefan and Klaus are in Chicago. Damon and Elena head over there while Damon tries to tell Elena how awful Stefan was while he was in Chicago in the 20s in hopes that she'll stay home. But she's committed to trying to rehabilitate him.
The two of them head for Stefan's old apartment figuring he'll come back there at some point. Elena stays there and tries to figure out a plan to get Stefan back, Damon goes and somewhere (maybe to the bar? I forget). Anyway, while Elena is there reading through Stefan old diaries, he and Klaus come back and Elena hides in a secret room. Stefan finds her (you know, while checking out his old murder wall), but manages to keep her a secret from Klaus.
Damon comes back and plans to try to distract Klaus, while Elena does whatever she needs to do to try to get Stefan to come home. They head over to the bar, and Damon directs Stefan outside. However, Elena is unable to convince Stefan. He tells her, that part of his life is over and this is just how it is now. She needs to leave before Klaus realizes she's still alive. She tries in inject him with vervain, but he's too fast for her.
While Damon is attempting to distract Klaus, Klaus tries to kill him. But, thankfully, Gloria does not want a mess in her bar and tells them to take it outside, sparing Damon.
While all this is going on, Klaus and Stefan are busy looking for a witch to help him turn hybrids. Gloria tells him he needs the original witch. And the person who can help him find it, is his sister Rebekah (who was in love with Stefan in the 20s). However, we see that Klaus has essentially killed her. But, he just yanks out that pesky dagger and she comes back to life.
Turns out, what they need is the necklace she was wearing when she died (or so she thought), but it's missing. In one of the many flashbacks to the 20s, we see that she lost it when the police burst into a club and starting firing wooden bullets, but that Stefan retrieved it. And I think it's same necklace as the one he gave Elena. Right?
In Mystic Falls, Caroline's fucked up father is trying to torture her into not giving into vampire impulses. Dude. If you would take one fucking second to listen to your daughter, you'd realize she already does this! Yes, she gets hungry when blood is presented to her, but that doesn't mean she's running around eating people! You're making shit worse. Thankfully, her mom shows up with Tyler and they manage to help Caroline escape.
So, not only does Klaus need Elena dead, but he also needs the necklace that she's constantly wearing. (Also, if she's dead, he probably wouldn't need the necklace, but still). Things are not looking great for anyone right now.