Following the angel Castiel breaking the wall in his mind, Sam started hallucinating Lucifer and going crazy, especially after he let Lucifer in for his help with rescuing Dean from Jeffrey. As a result, he stopped sleeping and after getting hit by a car, ended up in the Northern Indiana State Hospital where Lucifer continued to torment him and, unknown to him, one of the orderlies was possessed by a demon. Desperate to save his brother, Dean began searching for a faith healer and was led by the ghost of Bobby Singer to Castiel who had died releasing the Leviathans upon the world and had come back again with no memory. Castiel had become a faith healer and after Dean rescued his wife from a demon, agreed to come with Dean to save Sam, not knowing that he caused the problem in the first place or that he was the "Cass" that Dean talked about. Along the way, they were joined by the demon Meg, an old enemy of the Winchesters and a mutual enemy of Crowley's who agreed to help them as it went against Crowley who she hated.
Arriving back at the hospital, Dean, Castiel and Meg find four demons waiting in the parking lot for Dean to return. As they only have one demon-killing knife and there's too many demons for them to fight off, Meg subtly suggests to Dean getting Castiel to kill the demons as he has the power to take them all out himself as an angel. The two argue as Dean worries about what Castiel could do if he knows the truth, but Castiel overhears them and interrupts. Meg tells him the truth about him being an angel and Dean explains how its not a good thing. Castiel realizes that he's the "Cass" Dean mentioned when Meg tells him that he and Dean used to be "bestest friends", but insists he has no memory of it. Meg tells him that he has the power to kill every demon in the parking lot and when he tells them he doesn't know how, Dean insists that the knowledge is inside him. Castiel reluctantly agrees to try and goes to face the demons while Dean tells Meg he doesn't think it will end well.
Castiel approaches the demons who are stunned to see him as he's supposed to be dead. Telling them he's heard that, Castiel pulls one close and instinctively puts his hand to its head and smites it. His memories start to return and he smites two more demons simultaneously as they approach him. The last demon tries to run, but Castiel appears in front of him and informs the demon that running won't save him. Castiel then smites the last demon and informs Dean he has recovered his memory. Castiel is left horrified by the memory of what he did and became and after learning that Sam's in the hospital dying, walks away, feeling he doesn't belong there. Dean follows him, telling Castiel that he did the best he could at the time. Castiel tells him that the death toll in Heaven and on Earth from his actions was massive and he doesn't understand why he came back when he can't ever fix what he did wrong. Dean suggests that he came back to fix it and returns his trenchcoat to him. Castiel then agrees to help Sam.
In the hospital, after Sam puts to rest the ghost of Marin's brother, he is taken for electroshock therapy by Marcus due to the destruction he apparently caused. Marcus reveals himself to be a demon and uses the device to torture Sam. Though impressed by his resilience, Marcus decides to simply turn up the power on the machine when it fails to seriously harm Sam, but is interrupted by Castiel who smites the demon before he can do more harm and turns off the machine.
After killing Marcus and saving Sam, Castiel tries to rebuild Sam's wall but finds it gone completely and that there's nothing he can do for him. Knowing that Sam's condition is his fault, Castiel shifts Sam's madness to himself, curing Sam and driving Castiel himself insane and making him catatonic. He remains behind in the hospital guarded by Meg who takes a job as a nurse to protect him as no one else knows he's alive. Castiel eventually awakens when the Leviathan Tablet is broken open and regains his sanity after being transported to Purgatory.