During the holiday season, the Muppet Theater is going through financial hardship, and the Muppets are seeking
Kermit the Frog for guidance. Kermit is very upset and grouchy, lamenting over lost money, fear of losing the theater, and feeling that he is not useful to anyone. An
angel named Daniel brings this up with his Boss as they review what has gone on with Kermit in the past hours. Hours earlier, Kermit prepares a Christmas show with his fellow Muppets with Bobo the Bear playing
Santa Claus. Kermit is approached by Rachel Bitterman, a banker/real estate agent who says she will foreclose the Muppet Theater if Kermit does not pay her.
Pepe the King Prawn leaves the Muppets because he has fallen in love with Bitterman. Miss Piggy leaves the Muppets to go and work in Hollywood. While trying to raise money to pay Bitterman, Kermit attempts to find a celebrity to participate in his Christmas play, to no avail. Kermit travels out to California and retrieves Miss Piggy, who gets fired from working as an extra on the TV series
Scrubs. Meanwhile, after learning from Pepe that the deadline is midnight, Bitterman changes it to 6:00 p.m. Pepe overhears this and sets about informing Kermit about the deadline change, but Pepe keeps being interrupted. The Muppets perform their Christmas musical
Moulin Scrooge (a parody of the 2001 film
Moulin Rouge!) and Pepe continues trying to talk to Kermit. The musical is a success, concluding with a standing ovation. After the show, Pepe finally explains to Kermit that the deadline has changed and shows him the contract. Kermit sends Fozzie to deliver the money to Bitterman. Fozzie confronts a crazed nature-show host (spoofing
Steve Irwin), before being dyed green at a Christmas tree lot and mistaken for the
Grinch by a gang of angry residents of "
Whatville". Fozzie then goes through a steam bath and returns to his normal appearance. When Fozzie eventually makes it to the bank and Bitterman's office, he goes through a gigantic web of burning lasers leading to Bitterman's office several times, before finally discovering that he is too late, and that he has grabbed the wrong bag containing clothes for the Salvation Army following his incident at the Christmas tree lot. After witnessing these events, the Boss allows Daniel to help Kermit. When Daniel arrives, Kermit wishes that he was never been born, and Daniel shows Kermit what would have happened if he had not existed. In the world without Kermit, Bitterman has turned the park near the Muppet Theater into a shopping mall called Bitterman Plaza, the Muppet Theater itself has become a nightclub called Club Dot owned by Bitterman, Doc Hopper's French-Fried Frog Legs (first seen in
The Muppet Movie) has become a famous fast-food restaurant, and all of Kermit's friends have fallen into various detrimental situations. Kermit has Daniel restore him back to his reality and returns to the Muppet Theater. Bitterman arrives to shut the theater down and fights with Miss Piggy. Pepe appears and announces he has made the Muppet Theater into a historical
landmark, foiling Bitterman's plans. Defeated, an enraged Bitterman storms out of the Muppet Theater. Outside, the Muppets sing "
We Wish You a Merry Christmas". ==Cast==