When the Enterprise arrives at Vagra, Worf locates the shuttle, but cannot beam the two up- some sort of interference is not allowing the sensors to fully penetrate the debris. Riker, Yar, Data, and Beverly beam down to help. They find what looks like an oil slick, but one that follows them, constantly blocking their path from the shuttle. When Data theorizes that it could be alive, the slick responds to them, and assumes a vaguely humanoid shape.
It introduces itself as Armus, and claims not to share the Federation's ideals that all life has a right to exist. Yar tries to cross, and is instantly killed. Although she is immediately brought back to Sickbay and put on life support, it's too late. Armus, meanwhile, coats the shuttle and taunts Troi with what he has done.
Picard appoints Worf Acting Security Chief, and Riker goes back down to Vagra, with Geordi, Beverly, and Data. Armus torments them all, first allowing, then disallowing Beverly to enter the shuttle, then ripping off Geordi's VISOR and transporting it from place to place. When no one lets themselves be emotionally affected by Armus, he returns to the shuttle, where he explains to Troi that he came from a race of beings who managed to siphon off all their evil, which became him. The beings then departed, leaving him behind. When Troi offers her pity, Armus rumbles "save that for yourself!", flows back off the shuttle, and sucks Riker into himself.
Picard beams down to negotiate with Armus, as up on the ship, Worf and Wesley notice that the force-field is weakest when Armus coats the shuttle. Picard refuses to play Armus's game, even when threatened by Data's phaser, controlled by Armus. Armus eventually regurgitates Riker, and all but Picard and those in the shuttle are allowed to beam up. Armus then tells Picard that he wants transportation off-world. Picard says he might give it to him, but he must see his people first. Armus puts him in the shuttle, where Picard hurriedly consults with Troi. Troi tells him that Armus is most vulnerable when he's feeling his own rage instead of internalizing it. When Picard is brought back out, he manages to provoke Armus to greater and greater anger at his own fate, until the force-field is weak enough that everyone is beamed aboard.
Some time later, in a moving memorial, an image of Tasha tells everyone to remember how much she loved her life, and extols the virtues of each of her fellow crewmembers in turn.