Michael arrives at Camp Anawanna and becomes very popular with some of the other campers. Budnick then forces Michael and Sponge to join a ""secret club"" along with him and Donkeylips. As part of the club initiation, Sponge and Michael go to steal something from the girls' cabin. In a rush to avoid getting caught Michael takes, and then accidentally breaks, Telly's glasses.

Budnick tells the gang a ghost story about the camp's old custodian, Zeke. It is said that Zeke, who had lost his nose in an accident, was unable to smell a gas leak, which killed him. Budnick tells the group that whoever touches Zeke's plunger, will have horrible nightmares haunted by Zeke. Of course, everyone had bad nightmares that night. And so the entire group, with help from Ug, set up an elaborate plan to get revenge on Budnick.

Budnick finds a treasure map that supposedly leads to the buried cash of the camp's late dance instructor Sara Madre. He sells two copies of the map: one to Michael and Sponge, and another to Z.Z., Dina, and Telly. In order to find the treasure, the groups must go across the camp doing odd dance steps. As the groups try to be the first to the treasure, Donkeylips and Budnick find that watching the hunt is hillarious.

After Michael accidentally ruins some brownies that belonged to the camp's meanest kid, Thud Mackie, he needs to do something or face a beating. After all of his attempts to smuggle brownies into camp are foiled by Ug, he decides the best thing to do is leave camp. With everyone's help, he creates a video that exaggerates the horrors of camp to send to his grandparents. The video plan works, but Michael doesn't really want to leave, leaving him with a choise: stay with his friends at camp and be pounded by Thud, or leave.

At the girls' bunk Telly and Dina each try to bribe Z.Z. to vote one of them as Bunk Chief. At the guys' bunk, as punishment for putting a goat into Ug's cabin, all the boys must do the prep work for the Indian Counsel Dinner. They decide to get back at Ug by doing something that he would never expect: behaving.

The gang forms a basketball team that must play in a small camp tournament to earn the privilege of representing Camp Anawanna in a big basketball tournament. If they lose, their pictures are taped to the bottom of a toilet seat in the main lodge. Telly is the team's coach, but no matter how hard she pushes them, they keep losing. Once Budnick takes over as coach, though, everything starts to turn around and they start to do well.

Sponge uses the camp phone without Ug's permission to call into a radio contest. He wins the first round of the contest and a $100 prize. In order to win the grand prize, $1000, he must stay awake for 24 hours and wait for a phone call from the DJ and answer more questions. In exchange for a cut of the prize money, the others help to keep Sponge awake, sneak him past Ug to the phone, and force him to study for the questions.

In order to win a lobster dinner, Sponge and Donkeylips enter the wrestling tournament. Unfortunately Sponge is too light to wrestle and Donkeylips is too heavy. Ug gives them a few days to change their weight, and Telly agrees to train them. Meanwhile, the other campers are trying to avoid the horrible camp food by getting Sponge and Donkeylips to sneak burgers into camp while they are out training.

In order to get out of the daily activties, Michael and Budnick fake being sick. They end up spemding the day in the nurse's station with no good food (the fridge has ice cream in it, but is locked), and watching spanish TV. Meanwhile, the day's activity, unknown to Michael and Budnick when they faked ill, is a trip to the beach. The others look forward to a day of fun in the sun, but Ug decides to put Z.Z. incharge of the map and they all get lost.

The group must put on the camp's presentation of Cinderella. Dina is cast as Cinderella with Michael as the prince. Telly must play an ugly step-sister and Donkeylips is the coachman. Dina comes down with stage fright, however, and skips most rehearsals. She spends most of the time signing autographs and acting like a star around camp.

Dina leaves a love note for Michael on a painting that she thinks is his. It turns out to be Donkeylips' painting and he is thrilled that there is a girl that likes him. He starts leaving little gifts for Dina, who thinks that the gifts are being left by Michael. Eventually, Donkeylips asks Dina to the dance, leaving her with a choise of whether she will go with him or break his heart.

Z.Z. tires to get the others to clean up the camp. Unfortunately they really don't care. So Dina helps her throw a party to try and raise awareness, but that just makes a bigger mess. After the garbage man offers Z.Z. money for the camp's recycleables, she decides to bribe the campers into cleaning things up.