It was set after the Blame It On the Alcohol episode.
The Warblers ended up finding out what Kurt about bisexuals and subsequently start ignoring him. Pretty much everyone at Dalton follows the Warblers lead and do the same thing.
Kurt knows what's going on but feels that he can't take back what he says and actually adds more fuel tothe fire. He feels completely isolated at Dalton since no one will talk to him now. It goes on for a long time.
Towards the end, Kurt completely breaks down and runs away to the woods. Everybody goes looking for him and find him hysterical. He can't bear to face his own gender issues.
The Warblers and those at Dalton realize the toll Kurt has been under.