The Doctor and Leela find Professor Litefoot just as he is recovering. The time cabinet is gone. The Doctor starts to put more of the pieces together. His words don't make any sense to Leela or Litefoot. He speaks of the Peking Homunculus, a creature that looks like a short man but that is made of the cerebral cortex of a pig and computer parts. It's actions in the year 5000 almost caused World War VI.
The Doctor and Leela go looking for Weng-Chiang. Their quest leads them to an opium den where they find Li H'sen-Chang. One of his legs was gnawed off by a giant rat. He tells them to look for the House of the Dragon and to be beware of the eye of the dragon. He dies before he can tell them where to find the House of the Dragon.