EPISODE 10: "War" with John Duggan

Thatcher's leadership is challenged after Geoffrey Howe tenders his resignation in Parliament. Thatcher asks Elizabeth to dissolve Parliament but is reminded that both the Conservatives and the country are against her. She later steps down and receives the rare honour of the Order of Merit from Elizabeth. Despite doubts about her capability to carry a solo trip, Diana travels to New York City on a ConcordeTh and charms the general public. When the family gathers at Balmoral for Christmas, Elizabeth refuses to listen to Charles's complaints, telling him he needs to be more grateful for their privilege. Philip tells Diana she is not the only person suffering and should focus on serving Elizabeth, warning her of the consequences if the marriage should fail.

Thatcher and the Queen clash over imposing sanctions on apartheid South Africa. The Queen believes that the sanctions are necessary to fight racial segregation and bring the Commonwealth nations together, yet Thatcher believes this would hurt Britain's trade. After a series of modifications, including changing the word sanctions to signals, Thatcher signs the agreement to impose pressure on South Africa. Back in the UK, the press claims that the Queen is "dismayed" with the prime minister's actions. When questioned about it directly by Thatcher, the Queen insists on her apolitical position yet tells her press secretary to remain silent about rumours of a feud between the two women. The Queen's household holds the press secretary Michael Shea responsible for the rumours, to take the attention away from the Queen.

With Edward coming of age, Margaret finds her public role reduced and she falls into depression. She travels abroad to recuperate from having part of her left lung removed, and starts seeing a therapist on Charles's advice. After the therapist inadvertently mentions her deceased maternal first cousins Nerissa and Katherine Bowes-Lyon, Margaret learns that they are still alive and, along with three other cousins, in a mental institution. She confronts the Queen Mother, who claims the family had no choice as knowledge of the cousins' existence would have called the purity of the bloodline into question. Margaret confides her insecurities about becoming mad to her therapist, who reassures her she will not. Margaret reassumes her role yet broods in private.

Republican Bob Hawke becomes Australian prime minister, raising the stakes for Charles and Diana’s impending royal visit. He hopes the high cost of the visit will provide the tipping point to public backing of a republic. Diana insists on taking baby Prince William, to the Queen's disapproval. Charles and Diana discuss the difficulties of their marriage; Diana complains about his continuing interest in Camilla; they agree to try harder and, after a shaky start, the visit turns into a success with huge crowds turning out to see the young Princess, and their relationship temporarily improves. The Queen rewatches film footage of her own and Philip's tour of Australia in 1954 and becomes unsettled at the thought that this new royal tour is proving more successful. At an official reception, Hawke tells Charles that Diana has saved the monarchy in Australia. Charles and Diana argue again, and her eating disorder worsens. Back in the UK, they return to separate homes. Diana sees the Queen and tells of their unhappy marriage, but Elizabeth is unsympathetic and, when Diana tries to hug her, she walks out.

Republican Bob Hawke becomes Australian prime minister, raising the stakes for Charles and Diana’s impending royal visit. He hopes the high cost of the visit will provide the tipping point to public backing of a republic. Diana insists on taking baby Prince William, to the Queen's disapproval. Charles and Diana discuss the difficulties of their marriage; Diana complains about his continuing interest in Camilla; they agree to try harder and, after a shaky start, the visit turns into a success with huge crowds turning out to see the young Princess, and their relationship temporarily improves. The Queen rewatches film footage of her own and Philip's tour of Australia in 1954 and becomes unsettled at the thought that this new royal tour is proving more successful. At an official reception, Hawke tells Charles that Diana has saved the monarchy in Australia. Charles and Diana argue again, and her eating disorder worsens. Back in the UK, they return to separate homes. Diana sees the Queen and tells of their unhappy marriage, but Elizabeth is unsympathetic and, when Diana tries to hug her, she walks out.