Aubrey takes a train and then a bus to Kayako's home. While taking the long trip, she drifts asleep on the bus and dreams about being home. In the dream, she enters her mother's bedroom. Instead of the cruel demeanor she is used to receiving from her mother, Mrs. Davis is happy to see her and embraces Aubrey as she joins her in bed. Suddenly, her mother begins coughing, the dream distorts our view. Her mother's coughing gives off a vapor-look like gasoline fumes.
Aubrey falls back to see the entire room morphing, the furniture sliding away, and objects floating as Mrs. Davis continues her coughing fit. She upchucks a grotesque wad like a fur ball, only more like a throbbing organism. Mrs. Davis grabs Aubrey's face shoving the throbbing wad towards her mouth while scolding her. A vision of Kayako's diary pops in view showing a scratch drawing of Kayako upchucking a dark mass. And then Aubrey snaps out of her dream, feeling unsettled.
An old man (Isao Yatsu) on the bus turns towards Aubrey and waves, but not really waving at her. She looks to the empty seat beside her and is puzzled what the old man is looking at. He plays peekaboo with some unseen child, but Aubrey doesn't notice Toshio in the reflection of the bus window.
She goes to the house and finds Kayako's mother, Mrs. Kawamata, (Kim Miyori) who says that although she fed evil spirits to her daughter to heal others, she did not make Kayako what she is now. She explains that the events are not about the house, Kayako was killed by her husband because she was foolish.
That is where the curse started and now Kayko wants other to suffer the way she suffered. It will grow and destroy everything it touches. It will spread beyond the house, there can be no end to what has started. She then realizes that Aubrey had brought Kayako with her, and Mrs. Kawamata dies.
Aubrey leaves and returns to the cursed house. She calls home and tells her mother Karen is dead. When her mother accuses her of not being "able to do anything on her own," Aubrey tells her she loves her, but she will not allow her to talk to her like that anymore and says goodbye.
She goes into the house and sees Karen go upstairs, calling for Doug. Aubrey follows her. Then suddenly, the house appears like what it was when Kayako lived in it. She then sees a vision of Takeo reading Kayako's diary. Aubrey is now experiencing Kayako's murder as if she was Kayako.
As she turns to run away, her ankle snaps and she crawls down the stairs, but is caught by Takeo who snaps her neck. Comparison flashbacks from Kayako's death show exactly how she was murdered, and Aubrey is able to understand the pain Kayako went through as she shows her how she became evil.
Pasedena, California, days or weeks later: the sickly Mrs. Davis hears the doorbell ring and sees it is a delivery man who gives her a large box postmarked from Japan. A moment later she opens the box and finds her daughter's personal belongings. After a tearful moment, she notices the diary and flips through it. The next page she turns, her hand is now tangled with strands of black hair. Startled, she drops the diary and now the black hair is gone.
She picks up the diary which is now opened to the page with the drawing of the eye peering out. Suddenly it turns into the real eye of Kayako. She gasps and coughs out a huge black ball so large, it rips the skin of her cheeks.
The large ball rolls to the floor, like the head of Kayako, with one eye looking back at Mrs. Davis. In the reflection of the eye, we see Mrs. Davis' jaw has been ripped off with her tongue dangling out.