When Will and Lyra first meet they are terrified of each other. Lyra sees that Will has no daemon while Will is scared of Pan. The children learn to trust each other and go to Will's world in hopes of learning more about Dust and learning more about Will's lost father. There they meet a physicist named Mary Malone who has unknowingly been studying Dust. We learn more about what Dust actually is which very interesting.
Back in the other world, which becomes the pairs base of operations, the children explore an ominous tower in the centre of the city. They find an old man who tells them all about The Subtle Knife, a dagger which can cut doorways into other worlds. He claims Will is the next guardian of the knife but before he can give it to them another boy comes to claim it. He fights with Will, cutting off two of Will's fingers with the knife. Eventually, Will manages to kill him and take the knife.
In our world, an old man takes a frightening interest in Lyra and her alethiometer. He manages to steal it and together Will and Lyra struggle to reclaim it. With the knife now in Will's hands, they manage to use it to get the alethiometer.
We also follow Serafina Pekkala, the witch clan queen, as she tries to help her clan and learn about why the Church is so interested in Lyra. Along the way, she helps Lee Scoresby while he searches the scientist and explorer Stanislaus Grumman.
I enjoyed this book but the series suddenly brought in religious elements, with angels and 'The Authority'. I found this strange because it wasn't mentioned as prominently in the first book. But I enjoyed the book, especially learning more about the other worlds and Lyra's destiny.