General Beers kidnaps Allie, an alien-hybrid, and plans to use her as bait to lure the aliens into his trap.
Jay decides to attend a Open Your Heart seminar for struggling couples, even though she and Michael are happier than ever. Her excuse is prevention, but Michael warns her not to try fixing something that isn't broken. At the seminar, they are teased against each other and stop talking to one another. It takes Kady suffering an accident at school for them to realize how important communication between them really is. Meanwhile, Michael wants his children to learn the value of money and tells Jr. to start his own business selling monkeyfish like he. Jr., instead of the monkeyfish, decides to get refunds on the clothes Claire buys with a discount at the store she's working. When Jr. gets caught, Claire gets fired and Michael punishes him by making he wear the clothes he wanted refund.
In an effort to redeem himself days before Christmas, Cartman decides to bring Christmas to the Iraqis. So, along with Stan, Kyle, and Kenny they catch a ride with Mr. Hankey to the North Pole to bring Christmas to Iraq.
Dawson goes back to Capeside to celebrate Christmas and brings Natasha and Todd with him where Dawson can't get past the fact that he saw Natasha and Max together, and Todd's drunkenness bothers Gail. Joey also arrives back in Capeside with Audrey, where Eddie later arrives with a Christmas tree to celebrate. There Eddie meets and has an argument with Joey's father, Mike Potter, who worries that Eddie might not be good for Joey since he's now unemployed and doesn't go to college. Pacey also comes back to spend time with his brother Doug who does not like the expensive...
When Angie's parents, Vic and Emilina, visit for Christmas, George thinks they still believe he's not good enough for their daughter. But George shows he can take care of his family without their help and battles with Vic for the best Christmas.
Paul decides that he is going to make this Christmas the best one ever. As he and Cate decorate the Christmas tree the kids tell him what they want for Christmas. Rory wants a motorcycle, Bridget wants to be with Kyle on Christmas Eve, and Kerry wants to keep a lost puppy that she just found wandering in the street. Paul wants to win the brightest lights competition in the neighborhood, but it seems like the neighbors are winning.
An alien named Zim from the planet Irk is sent on a secret mission to conquer Earth, not realising that his leaders were just trying to get rid of him and hoped that he would die. Once there, Zim manages to disguise himself as a human child, but one boy named Dib sees through his disguise.
Short-story writer Andy makes his living by working at a huge faceless company in present-day Chicago, writing technical manuals.
Cheryl is hoping to have the family invited to a neighbor's popular annual Christmas party, but Jim dashes her hope when he fights with the neighbor's husband.
Frasier and Niles bicker over which of their two households should host Christmas dinner for the Crane family. When Martin is appointed the tie-breaker, each brother tries to bribe him.
Andy and Theo move out. Tony thinks about calling it a day with his ex-wife. Sipowicz and Clark Jr look into the threats made to Clark Sr. A distressed, schizophrenic young man keeps saying "she can't breathe".
Charlie and Lisa learn about their daughter Allie's amazing powers while trapped in a perilous situation. Mary Crawford lays the groundwork to snatch the child for government research.
Nick takes the case of a year old mom who wants to put her baby up for adoption, after her father ends up being arrested for the murder of the year old's very ill mom. Brian Olsen LuLu's Husband ends up being accused of negligence.
When Jackie's father is arrested for bribery, Kelso thinks she'll come running back to him. But when Hyde and Kelso get into a brawl over Jackie, Kelso accidentally shoots Hyde with a BB gun and all hell breaks lose. Donna and Eric argue over how Hyde should deal with Jackie's pain. Meanwhile, Fez realizes he has a crush on his boss at the DMV.
The next generation comes into play, as the children of both Jacob Clarke and Jesse Keys become the focus of both a government investigation and alien interest.
Not willing to breach confidentiality Lily makes a sacrifice to keep a late night confession secret. Elsewhere Dr. Macy and D.A. Walcott are forced to work together to put a sexual predator behind barswhere he belongs.
Robert gives Ray a great idea on what to get Debra for Christmas, but he isn't very happy when Ray takes all the credit for it.
Farnsworth's clone Cubert teams up with Hermes' son Dwight to launch a newspaper delivery business. Farnsworth and Hermes scoff at the kids' efforts - until the delivery boys accumulate enough capital to buy out Planet Express. Meanwhile, Fry and Leela use Bender to brew their own homemade beer.