Inside of the iceberg is a 12-year-old boy named Aang and a giant flying bison named Appa.
Unknown to them, Aang is the long-lost Avatar — the only person capable of "bending" all 4 elements of Air, Water, Earth and Fire.
On the ship, Aang is tested by Zuko's paternal uncle Iroh to confirm he is the Avatar.
After being informed that he is to be their prisoner for passing the test, Aang escapes using his glider and flies to his flying bison brought by Katara and Sokka.
Aang also learns that he was in the ice for a whole century and that the Fire Nation wiped out all of the Air Nomads, including his guardian, Monk Gyatso.
In despair, he enters the Avatar State and finds himself in the Spirit World where he encounters a Dragon Spirit.
Katara's pleas bring Aang back out of the Avatar State.
Noticing the danger, Zuko manages to survive the attempt on his life with Iroh's help.
He sneaks aboard Zhao's lead ship as his fleet departs for the Northern Water Tribe, which is a heavy fortress, to capture the Avatar.