Julia was committed to a mental institution after being driven further to insanity by her time in prison. She escaped from the mental institution and, vowing revenge on her mother, abducted Melissa's baby, Joseph. She released Joseph but was presumed dead after being trapped in a cabin that went up in flames. The third season closed with Julia's final request that the Channings and Giobertis board a plane for Italy, which plummeted toward a crash landing.

The fourth season revealed that Angela's shrewd lawyer and husband, Phillip Erikson, and Dr. Michael Ranson died in the crash. The Cartel, a shadowy international syndicate headed by an exceptionally vicious man named Gustav Riebmann, were the masterminds behind the crash and made waves in the Tuscany Valley. The Cartel had been co-founded by the late Jacqueline together with Gustav's father, Johann Riebmann, and surfaced in the valley because it believed a large fortune once belonging to the Nazis had been buried on the Falcon Crest estate. Before the crime ring was destroyed, residents endured a series of plane crashes, bombings, and buggings.

Angela finally got revenge against Richard by taking over The New Globe. Her first course of action was to appoint Lance editor. Richard retaliated by framing Lance for the attempted murder of Angela, but Lance was cleared of all charges. Richard also acquired one-third of Falcon Crest from Angela's half-sister, Francesca Gioberti. Julia returned after her presumed death in the spring house, while Melissa divorced Lance, married Cole, and then constantly fought with him. Cassandra Wilder arrived in Falcon Crest and began a vendetta against Angela for wrongs Angela supposedly inflicted on her family, headed by Anna Rossini. By season's end, Cassandra had succeeded in causing the financial ruin of both Angela and Richard.

Angela turned to her former lover, wealthy shipping magnate Peter Stavros for assistance. Before he was able to help Angela, he was abducted by his daughter Sophia and her French husband, Philippe Hubbert, who wanted to take over the Stavros Industries empire. Once Peter was freed by Lance, he proposed to Angela. Angela realised that she could become Peter's wife or allow him to be her landlord, and accepted his proposal. Peter's son, Eric followed his father to Tuscany Valley. Richard managed to rebuild his own financial empire by siphoning money from the Tuscany Downs racetrack. Terry found out and blackmailed him into marriage. Richard's new lawyer, Jordan Roberts, suffered from a split personality, and became Monica, a professional hooker by night.

Maggie suffered from amnesia after an explosion and through her fog wrote a thinly veiled, fictional expose about the residents of Tuscany Valley. After her book was published, her publisher assigned an aspiring novelist and book publicist named Jeff Wainright to help her sell her book. While on tour together, Jeff became obsessed with Maggie and kidnapped her. He then raped her but Maggie was rescued. Unable to have another baby together, Melissa and Cole hired a surrogate mother, Robin, who seduced Cole and then kept the baby. Emma fell in love with a trucker named Dwayne Cooley and Lance fell for rock singer Apollonia Kotero. The season ended with the escape of Jeff Wainright and a major earthquake hitting Tuscany Valley. The aftermath of the earthquakeleft the valley in turmoil, with Emma's fiancée, Dwayne, and Maggie's sister Terry, not surviving.

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