The Grim Grotto

Klaus examined the tidal charts to estimate the location of the sugar bowl relative to the water cycle. He suspects it to be in the Gorgonian Grotto. An octopus-shaped submarine, captained by Count Olaf, appears on the Queequeg's sonar, but it is driven off by a mysterious object which appears only as a question mark on the radar screen.

Fiona then looks in her mycological textbooks to research the Gorgonian Grotto. It is a cone-shaped cave which houses a rare species of poisonous mushroom named Medusoid Mycelium. They wax and wane, but are deadly when waxing. The grotto is remote enough that it can quarantine the Medusoid Mycelium from the outside world. Fiona suspects there may be an antidote to the poisonous effects of the fungus.

When the submarine arrives at the Grotto, Fiona, Klaus, Violet, and Sunny are sent in. After floating to a sandy beach scattered with many items that have washed ashore, they find a narrow room with three lamps, of which two are lit.

Whilst they search the beach for the sugar bowl, the Medusoid Mycelium suddenly wax, springing up from the beach and the tiled floor and walls - and the children retreat to the narrow room where the spore does not appear. While they are waiting for the Medusoid Mycelium to wane, the children occupy themselves by continuing to investigate the knick-knacks lying around the cave, some of which seem to be connected to the V.F.D. including a newspaper article, a book of poetry, and a personal letter. Sunny also picks up some food to prepare a meal for them all, including a tin of wasabi sauce. A few hours later the Medusoid Mycelium wanes and they return to the submarine.

Once they get to the submarine, they discover that Widdershins and Phil have vanished from the submarine, and that a spore of the mushroom has infiltrated Sunny's helmet while in the grotto. Fiona stops Klaus from opening the helmet, insisting that Sunny must remain isolated in the helmet for all their safety until she can find an antidote. Just as the ship starts up, Olaf's submarine engulfs it, capturing the children. The orphans enter Olaf's ship, finds out that it is powered through the labor of the captured Snow Scouts, and are taken to the brig where they are interrogated by the hook-handed man, who is revealed to be Fiona's brother - Fernald. Fiona begs him to help them return to the Queequeg, for Sunny's sake, and Fernald agrees on the condition that they take him along.

While trying to sneak back into the Queequeg, Esmé sees Fiona and Fernald. They make up a distraction so Klaus, Violet and Sunny can escape into the Queequeg unnoticed.

Back on the Queequeg, Klaus and Violet search for a cure for Sunny and with the help of V.F.D. couplets, realize that the antidote is horseradish. They search for horseradish, but find none. They ask Sunny if there's anything similar to horseradish. Sunny manages to gasp one word, wasabi, and her siblings give her some of the condiment she brought back from the cave, and they eat the remaining wasabi.

While Sunny has a short nap, the telegram machine produces a Voluntary Factual Dispatch from Quigley Quagmire, the siblings are summoned to a certain coded location the next day, just two days before the V.F.D. meeting at the Hotel Denouement. Klaus decodes the first poem by Lewis Carroll, telling them he wants them to meet at Briny Beach. Just as Violet begins decoding the second, based on T. S. Eliot's poem The Waste Land, they are discovered by Olaf and his accomplices. Shortly after, on the radar, the mysterious question mark-shaped object reappears on the radar; Olaf, who clearly recognizes the object, orders everyone to battle stations to prepare for flight. Fiona, knowing she has made the wrong decision, allows the Baudelaires to escape in the Queequeg. Olaf grabs the quarantined helmet full of Medusoid Mycelium. Sunny fixes the huge hole that Olaf created on the submarine using an enormous ball of gum and they escape Olaf's submarine.

The next day they arrive on Briny Beach - back where all of their troubles began. Surprisingly, Mr. Poe emerges from the fog. He received a message from the mysterious J.S. that he had to meet them at the beach. Violet, however, has decoded Quigley's message and has concluded that a taxi will meet them at the beach. They bid farewell to Mr. Poe and arrive at the taxi to find an unknown woman at the wheel, who reveals herself to be Kit Snicket. The children climb into the taxi, ending the book with fortune to their favor for the first time.

• Brazilian Portuguese: "A Gruta Gorgônea", Cia das Letras
• Czech: "Ponurá sluj"
• Finnish: "Synkkä syöveri" (The Grim Whirlpool), WSOY, 2006, ISBN 951-0-31491-9
• Greek: "Η Σπαρακτική Σπηλιά", Ελληνικά Γράμματα
• Japanese: "ぶきみな岩屋" (The Weird Grotto), Soshisha, 2006, ISBN 4-7942-1546-0
• Norwegian: Den grusomme grotten, Tor Edvin Dahl, Cappelen Damm, 2005, ISBN 9788202245269
• Russian: "Угрюмый Грот", Azbuka, 2006, ISBN 5-35201-790-7
• French: "La Grotte Gorgone" (The Gorgon Grotto)
• Polish : "Groźna grota" (The Menacing Grotto)

The book was adapted into the third and fourth episodes of the third season of the television series adaptation produced by Netflix.[1]

Wikiquote has quotations related to: The Grim Grotto

• Esmé Squalor
• Carmelita Spats
• V.F.D.