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At the cliff house, Steffy asks Finn, “What’s the incredible news?” He tells her, “You won’t believe it.” Steffy can’t believe how excited he seems and asks, “Can you tell me what’s going on?” Finn replies, “Well, it all begins with Sugar.”

At Deacon’s place, he wants to take Sheila to Vegas and marry her tonight. Sheila teases that maybe she’s having second thoughts. Deacon dramatically pretends to have a knife to the heart. He goes over how torn up inside he was when she was gone. He doesn’t want to lose her again. Deacon promises to get her a ring. Sheila tells him he doesn’t owe her anything; she wouldn’t be there if it weren’t for him. She closes her eyes and tells him she’s a little dizzy. Deacon insists they go to the office and get her checked out. He gives her water and recaps that Finn wanted her to go to the hospital and she refused. He’s not playing around with her health. He works to convince her at length, promising they can come home later and play a different version of doctor. Sheila giggles and agrees. Deacon assures her they’ll be back there planning their nuptials before she knows it. They kiss.

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At Forrester, Hope is reading a story online about Sheila being dead. She flashes to discovering she’s alive. Suddenly, Ridge and Liam enter the office after a meeting and notice her grimacing in her chair. Liam asks if she’s OK. She’s honestly not sure how to answer that. Liam asks if she was unable to talk Deacon out of the “Sheila is alive” nonsense. Hope says her dad’s not crazy. He’s right. “Sheila is alive.”

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Ridge can’t believe this and asks if Hope is doing the same thing now. Hope insists Deacon’s not making it up. Ridge rants, “Hope, come on! Sheila is dead. My daughter put a knife in her.” Hope says, “Except she isn’t dead, Ridge! I saw her. Sheila is alive.”

After having heard the story, Ridge declares that this is insane. He’s heard the stories about Sugar too, but she’s not part of this story. Hope had a hard time with it too. She arrived hellbent on getting her dad to give up on this theory, but the door opened and Sheila was just standing there. She was so shocked she actually passed out. When she came to… she was still there. The woman Steffy killed that night was not Sheila, it was her lookalike Sheila. Hope insists she didn’t just see Sheila, she spoke to her and she spoke back. “Sheila Carter is alive, whether we like it or not.”

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In the hospital, the nurse fusses over Sheila as Deacon tries to keep them entertained. Deacon remembers he left his phone in the car. Sheila assures him she’ll be fine, so he goes. The nurse asks how long they’ve been engaged. Sheila smiles, “Would you believe a few hours.” She tells the nurse they were engaged before but this time it’s going to be different. “Everything is going to be different.” Just then, Sheila hears Li’s voice on the other side of the curtain. She grins and asks the nurse if Dr. Finnegan could see her. The nurse agrees to go speak to her.

In the corridor, the nurse tells Li that there’s a patient asking for her. She’s suffering from dehydration and malnutrition. “Her name is Sheila.”

At the cliff house, Steffy asks, “What about Sugar?” Finn says she’s a person. Steffy asks, “And you know this person?” Finn doesn’t know her at all. Steffy’s very confused. Finn suggests they sit down and then tells her, “This whole thing is just unfathomable, what I’m about to tell you.” He knows it will be hard for her to believe, but it is real. Steffy asks, “What’s real? Finn, you’re not making any sense.” He tells her Sugar is a woman who looks exactly like Sheila. Steffy stammers, “Wh-what?” She wants to know what this Sugar person has to do with Sheila. Finn replies, “Everything.”

At Forrester, Ridge goes over Hope having seen and talked to Sheila at Deacon’s house. Hope wouldn’t believe it either if she hadn’t seen her for herself. It was Sugar who went to Steffy’s house that night, not Sheila. She knows they’ve been thinking they were safe from Sheila, but she was actually a victim. Liam groans and Ridge asks, “What? Sheila is a victim?! Is that what you just said?!” Ridge asks if she realizes how far-fetched this sounds. Hope is certain after today. “Sheila Carter lives on.”

At the hospital, Sheila grins from ear-to-ear as she hears that nurse ask Li if she’s alright. Li exhales and says the name Sheila used to send a shiver down her spine. “Thankfully, not any longer.” Full of glee, Sheila covers up as she hears Li confirm she’ll see the patient. Li pulls back the curtain and asks her to pull the sheet down so she can examine her. Sheila fights laughter underneath the sheet.

As Li’s about to walk out, Sheila pulls the sheet off of her feet. Li stammers, “Your toe! What happened. Is that why you’re here? You want me to examine your missing toe? Remove that sheet! Show me your face!”

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At the cliff house, Finn tells Steffy that Sugar looks so much like Sheila it’s impossible to tell them apart. “They could be identical twins.” He explains it was Lauren Fenmore that told Deacon about Sugar. Years ago, Sheila tricked Sugar into getting plastic surgery, so the woman would be convicted for Sheila’s crimes. Sugar ended up in a mental ward. Steffy asks why he’s bringing all this up. Finn explains that Sugar and Sheila are identical in every single way but one. “Sugar has all her toes.”

Finn explains that Deacon was afraid Sugar had it in for Sheila, so they went through her credit card history and tracked her down. “We found her, Steffy. In an old abandoned warehouse.” Steffy says, “You found Sugar.” Finn says no, they found Sheila. Steffy says Sheila is dead. She died in their house, right there on the floor. Finn knows that’s what she thought, but it wasn’t Sheila. Steffy says Deacon is losing it and he’s obviously got into his head somehow. Finn insists Deacon saw Sugar’s body at the crematorium, not Sheila’s. “Do you know what that means, honey? It means you didn’t kill my birth mother. You didn’t kill Sheila. She’s alive. My birth mother is alive.”

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Next on The Bold and the Beautiful: Li comes face to face with her archenemy, Sheila Carter.