On closer inspection of the victim, it is found to be Lucie, Valerie's older sister. The townspeople offer a monthly sacrifice to the beast and stay away from the woods but Lucie ventured there after discovering that Valerie had been promised an engagement to Henry, whom Lucie loves.
While Suzette, Valerie, Prudence, Roxanne, Claude and Rose mourned Lucie, Roxanne asked why Lucie was out on a wolf night, Prudence thought she'd snuck out to meet a boy, Suzette claimed Lucie never even thought of boys. Madame Lazar revealed that Lucie was certainly taken with her grandson, Henry Lazar. She used to come by and "follow him around like a puppy", and she found out that night Henry was engaged to her sister, Valerie.
After Adrian was murdered after the search for The Wolf, Valerie finds Suzette mourning Adrian and figures out that he was her love. She also realizes that Lucie, being the older daughter, should've been the first to wed and should have been engaged to Henry. Suzette confessed that Lucie could not as she was the illegitimate daughter of Adrian Lazar, making her Henry Lazar's half-sister.
Grandmother goes to see Henry and tells him he was under no obligation to stand up for Valerie, after she was accused of being a witch. Henry says just because he and Valerie were no longer engaged to each other, that doesn't mean he stopped caring for her. Grandmother asks him if he cared about Lucie, just as he cared about Valerie. Henry said she had a crush on him. Grandmother claimed that Lucie had more that a crush on him and probably would have done anything to be with him, even agree to meet him on a Wolf night. Henry claims he never asked Lucie to meet him out on a Wolf night, and upon smelling the Wolf's musk smell on Grandmother, accuses her of being The Wolf and killing Lucie and his father. Grandmother is shocked by this and tells him not to accuse people who are innocent, much like herself.
Henry takes Valerie to the church, but they are attacked by the Wolf, who bites off Father Solomon's hand, which contains silver-coated fingernails. The townspeople shield Valerie from the Wolf, who is once again forced to flee, but not before burning a paw by touching the holy ground of the church. Valerie dreams that her Grandmother is the Wolf, who lives in the nearby woods, so she goes to check on her. Father Solomon, having been cursed, is killed by the Captain.
After retrieving Father Solomon's hand, Valerie rushes to her Grandmother's cabin, but is confronted by Peter. Noticing his hand is burned in the same place where the Wolf burned its paw trying to enter the church, Valerie assumes Peter is the Wolf and stabs him. Arriving at Grandmother's house, Valerie is horrified to find her dead, and learns that the Wolf is her father, Cesaire. He reveals that the curse was passed to him by his own father, and he intended to leave the village for a better life, but wanted his children to come with him. He sent a note to Lucie pretending to be Henry to meet him on a Blood Moon night, outside by the haystacks so he could ask her to accept her "gift". However, upon confronting her while she remained so frightened by him in his Wolf form, he couldn't communicate with her, and, realizing she was not his daughter, murdered her in a fit of rage. He then took revenge against Adrian, his wife's lover, and now wanted Valerie to accept the curse.