This episode stands out simply because of the fact that it's the first episode of Game of Thrones to focus only on one location: King's Landing, under attack by Stannis Baratheon. And this battle hit home the fact that the Lannisters are not ones to mess with, even for someone with the Lord of Light (supposedly) on their side. But "Blackwater" also reveals a lot about the character of the Lannisters themselves: Tyrion discovered some serious courage and leadership, we saw the depths of Joffrey's cowardice, and we saw Cersei's selfish bitterness about the limitations of being born female come to light — and it is revealed just how far she is willing to go to protect her children.
All that character development is still broken up by moments of serious awe and badassery. The incredibly destructive power of wildfire, the Hound getting fed up with risking his life for a king he despises (and instead offering his aid to poor Sansa), and the revelation that someone high up in King's Landing is out to get Tyrion killed. Lots of action for only one location.
