When Caroline is first introduced, she is seen as too nervous to talk to Fez, who she thinks is cute. She is given tickets to a concert by Donna causing her to end up on a date with Fez.
During Dine and Dash, Fez tried to impress her while she working as a waitress but she does not have time for him. At the end, she apologizes but realized they are a couple now with their first real fight and tries to reconcile with a kiss. However he was suffering from her laxative that Donna and Eric had placed in his brownie. After cursing the pair, he dashed past Caroline’s please to him as she chased him.
In Donna's Panties, she and Fez become boyfriend and girlfriend. During this episode, her true personality is hinted at during their date at the movies.
Her true personality is revealed in Kitty's Birthday (That's Today?!) when she revealed to Hyde that she thought of choking herself when she thought about him dumping her.
In Holy Craps!, she learned that Fez had kissed Jackie and freaked out on Donna and Jackie. She then showed Fez when the girls showed how close they were. Fez then broke up with her.
Despite this, she still wanted to be with him as seen in Fez Dates Donna, to the point of her stalking him. She ends up spying on his fake dates with Donna, not realizing it was all fake. It truly ends when Donna revealed that Fez didn't like her anymore.
She returns in Stone Cold Crazy, acting just as crazy as before. However Fez still had feelings for her, so he still chose to go out with her. He pretended that Jackie and Donna were maids to get her to calm down once she realized that they weren't alone.