On her mission to stop Cloak, O'Reilly stumbled into a robbery -- of Father Delgado's church, no less. Cloak appeared just in time to stop the would-be robbers, while O'Reilly observed from a confessional. The ensuing fight led her to question whether she truly wanted to stop him and, when she emerged from the confessional to arrest the robbers, he took their bullets for her and saved her life.
When the fight was over, Cloak admitted that the hunger of the darkness inside him sometimes overcame him. In a show of good will, he ejected the murderer he had absorbed. As a result, O'Reilly found she had no reason to arrest him, as Cloak hadn't killed him after all. Then, after learning how the vigilante duo were imbued with their powers, O'Reilly decided to drop their case altogether.
In Cloak & Dagger's 1985 maxiseires, O'Reilly's story took a strange turn. In the very first issue, she discovered corruption within her department. As it turned out, some officers in her department had struck a deal with local crime rings, where these corrupt cops would provide a heads up if the police were about to make a sting. Armed with this knowledge, she made it her personal mission to uncover every last corrupt cop in her precinct. She was warned this would make her "a lot of enemies," but she forged on regardless.
Even as she dealt with her department's corruption problem, she continued to perform her regular duties. This put her in Cloak and Dagger's path once again, as they were both after the same shipment of narcotics, which was set to arrive in New York by boat. Thanks to some meddling by Spider-Man, the shipment got away, infuriating O'Rielly but certainly not dampening her drive to serve justice. However, it did inspire her to use some unorthodox methods, up to and including beating information out of a suspect.
Unfortunately for O'Reilly, some of her people were also corrupt. During a bust at a warehouse in issue #5, they led her right into a trap. When she discovered a piece of evidence in plain view, she approached with two other cops, only for a plastic cage to emerge from the floor and trap them inside. What's worse, the plastic cage turned out to be a gas chamber. Gas immediately seeped in through the floor and, despite a few valiant efforts to escape, all three officers suffocated to death.
Nevertheless, this wasn't the end of O'Reilly. Cloak and Dagger discovered her too late to save her, but Dagger tried to resuscitate her anyway. Dagger's efforts brought something back, but it wasn't wholly O'Reilly. O'Reilly transformed into a creature with pallid skin and pupil-less green eyes; what's more, she now had strange new abilities, including the power to emit venomous gas from her pores, a scratch that paralyzes and flight.