It was another dramatic day in court for Lindsay Lohan.
The "Mean Girls" star pleaded not guilty Wednesday to charges of grand felony theft for allegedly stealing a $2500 necklace from a store in Venice, Calif. in January.
Bail was set at $40,000, the court set a date for February 23 for an initial hearing, and the judge warned her that, given she is already on probation for a 2007 DUI, any brushes with the law while the case is in motion would result in immediate incarceration without bail.
"You need to follow the laws just like everybody else. Look around the room. You are no different than anyone else," Judge Keith Schwartz told her sternly. "So please, don't push you luck."
Despite the fact that Lohan faces a maximum of three years behind bars if convicted, a source very close to the star told FOX411’s Pop Tarts that she is optimistic her “not guilty” plea will stand up in court.
“Lindsay is feeling really calm and confident. She is aware of every decision she makes,” said the insider, adding that Lohan continues to make “great progress” since being released from the Betty Ford Rehab Facility at the beginning of the year, and is determined to not let this incident derail her positive frame of mind.
Just prior to her court appearance on Wednesday, the 24-year-old asked friends to “pray for her,” yet the day before she was getting on with duties of life, like getting her hair done at the swanky Byron & Tracey Salon in Beverly Hills.
Furthermore, Lohan's lawyer Shawn Chapman-Holley said the "Mean Girls" star was entering an early disposition program where she could work out a deal to keep the case from going to trial, and we’re told Lohan’s camp feel very sure the case will be resolved.
Hollie McKay has been a FoxNews.com staff reporter since 2007. She has reported extensively from the Middle East on the rise and fall of terrorist groups such as ISIS in Iraq. Follow her on twitter at @holliesmckay