Sabrina must prove that she is worthy of attending an academy for witches.

Sabrina travels to Australia's Great Barrier Reef with her best friend Gwen, a fellow witch from England, for a week-long vacation where they try to help protect a hidden mermaid colony whose habitat is threatened by ocean pollution, and by a local marine biologist determined to find the colony as his claim to fame. While Sabrina finds romance with a "merman" from the mermaid colony, Salem the cat finds a possible romance with another witch-turned-into-a-cat, named Hilary, but finds Sabrina's problems interfering with his plans.