Commander Sisko, in dress uniform, prepares to receive the first formal alien delegation from the Gamma Quadrant — a group from a newly discovered species known as the Wadi. Sisko, Kira, Dax, and Bashir greet the new representatives from this race at one of the docking bays, after the Wadi's arrival through the wormhole. But the leader of the group, a humanoid male named Falow, dispenses quickly with the pleasantries. He and his companions want to be taken immediately to Quark's, where they have heard they will find games to play. The disappointed officers escort the delegation.
Quark, upon meeting the Wadi, senses profit in the making. The aliens show Quark they have much to wager in priceless gemstones, and quickly learn how to play the game of Dabo. Hours later, they are still going strong and winning big at the Dabo table. A weary Sisko decides to call it a night, leaving the Wadi with an equally tired Quark. He unsuccessfully tries to discourage them into leaving. Discreetly, he has one of his assistants rig the Dabo table to make the aliens start losing, hoping that will do the trick. Unfortunately, Quark's accomplice is caught by the Wadi. The Ferengi fears reprisal from the visitors. But Falow decides instead to have Quark participate in playing a new game — one of Falow's choosing. He opens a rectangular metallic case, which releases a blinding flash of light. When it clears, the Dabo table is gone — replaced by a strange alien game board. The game is called Chula. Quark's objective — to move his four oddly shaped onyx figurines around the serpentine downward spiral of the board. Quark watches with apprehension as the board is set up and the Wadi begins placing bets. Meanwhile, Sisko, sound asleep in his quarters, turns over in his bed. He wakes up to find himself dressed in standard uniform, lying on a hard stone floor instead of the bed. He is no longer on the space station, but in an alien corridor, empty but for a series of doors with strange markings — and totally alone.
Determining he is in no holodeck illusion, Sisko tries each of the doors, looking for escape. He finally opens one, only to find Falow on the other side, instructing Sisko cryptically to move along home, after which the door quickly closes. Then a piercing scream leads Sisko down the corridor, where he discovers a terrified Bashir, trying to wake himself up from what he thought was a bad dream. Kira and Dax turn up next. Together, they try to find the way "home."
Learning from Sisko's son that the commander has disappeared from the station, Odo soon discovers the other three senior officers are also gone. Back at Quark's establishment, the Ferengi is forced to begin play on the new game, even though he does not yet know the rules. He places a minimum bet and rolls the alien dice. Falow states that the combination will cause Quark's pieces to meet the Chandra.
In the labyrinth, Sisko and the other officers follow a singing voice to discover a young Wadi girl chanting a rhyme while playing an alien game similar to hopscotch. A force field keeps them from getting to a door on the far side of the room, but the girl can pass through it without a problem. Dax determines they can get to the door that only by repeating the rhyme and performing the hopscotch-like moves. The four officers do it, and are able to exit, with the girl telling them they are at the Third Shap. As this happens, the Wadi group in Quark's goes wild because he has reached the next level. The befuddled Quark wins a nice payoff, not realizing the connection.
Falow proposes to Quark that he can progress faster by taking a shortcut on the board, although it doubles the risk to his game pieces. However, a successful move can also double his winnings. While he thinks, Odo arrives, asking Quark if he might know anything about the missing crew members. A knowing look from Falow causes Quark to make the connection with the four game pieces and the four missing officers. Realizing that the lives of Sisko and the others are literally in his hands, Quark chooses to move the pieces along the safer path. The four officers, meanwhile, continue along the alien corridors, slowly realizing that they may indeed be pawns in one of the Wadi games. A door opens revealing a Wadi party in a smoke-filled room. Falow and other revelers carry drinks. The officers begin to cough violently form the smoke, until Bashir discovers the drinks are really an antidote. A back door to the room opens, and Falow announces the proclamation of Shap Four. The party vanishes and the officers exit through the door. Back at Quark's, huge reactions with the success. A larger pile of jewels is shoved toward a happy Quark, while Odo watches with displeasure.
Discovering a strange bi-polar current aboard the Wadi vessel, Odo finds a room on the ship that emits a blinding light. He enters the chamber, and suddenly appears in Quark's. Odo tries to break up the game. But Falow, knowing that Odo is putting the pieces together, tells Quark the game must continue or he will lose his players. Quark, with Odo's prodding, decides to continue his game pieces along the safer path. He rolls the dice. The Wadi gasp, and Falow announces that it is an unfortunate roll. In the maze, the officers hear a weird energy surge building, which becomes an ominous swirling field which they try to elude. But Bashir is caught by it and swept away. Back to the game, the Bashir game piece is placed in a holding area on the board. Quark decides to gamble, despite Odo's protestations, and take the pieces on a shortcut, hoping to end the game in one move. The chance doesn't work, though. The resulting dice roll causes Falow to declare that Quark must sacrifice one game piece so that the other two may live. Quark begs to not be forced into picking a piece. Falow leaves it for the board to determine at random. As the final wagers are placed, Sisko, Dax, and Kira continue wandering through the corridors. They hear Bashir, shouting he's found the way home. Following his voice, they enter a cavern. The ground begins to shake, causing Dax to injure her leg. Falow again appears, telling them to go to Shap Six. Not finding Bashir, the officers try to escape, but massive quakes in the cavern open an abyss into which they fall helplessly. Suddenly, all four of them find themselves back in Quark's establishment. Falow then informs them that even though Quark lost, they were never in any real danger. It was only a game, after all. Sisko and the others realize this predicament wouldn't have happened if it wasn't for Quark's cheating. As for whether or not he learned his lesson ...