"Knights Uniqua and Tyrone are ready to do mighty deeds in service to their King, Pablo. But he wants them to babysit…an egg? It all seems pretty simple until the egg grows legs and runs away. Then the mighty knights must pursue it — through Goblin land where they encounter a grabbing goblin (Austin), through Fairyland where they meet a tiny but flighty and mischievous fairy (Tasha), all the way to Dragon Mountain where they face a mighty dragon. Will the knights face and conquer their greatest challenge yet?"
A recap montage depicting key scenes from the previous episode is shown. The next scene shows the Grabbing Goblin and the knights holding onto a twig over a waterfall. The knights are holding King Pablo's egg. The Goblin tells the knights that his nose itches and he needs to scratch it, but the knights tell him that if he scratches it, they will all fall. Uniqua tells him that she will scratch it with her free hand, but cannot reach his nose. The Grabbing Goblin offers Uniqua his hand so she can get up higher, but he inadvertently lets go of the twig.
The Grabbing Goblin, Tyrone, Uniqua, and the egg fall down. They suddenly see light and head for a way out of the cave. They then come to a forest, the forest where the Flighty Fairy lives. The egg sprouts two legs and runs off. The Flighty Fairy, Tasha, notices the egg. She immediately falls in love with it and uses her magic wand to make it fly in the air. She names it Eggy. The knights and the goblin find the fairy and ask her if she could give the egg back. The Flighty Fairy refuses. She sings the song "Tweedily-Dee". The egg sprouts wings and flies in the air without assistance of the Flighty Fairy's magic. It flies away.
The Grabbing Goblin, the knights, and the Flighty Fairy start to journey off to find the egg. They suddenly find themselves following the egg to Dragon Mountain, a legendary mountain believed to be the home of a fire-breathing dragon. The egg flies into a large crack in the mountain, where the vicious dragon is thought to live. As they trek up the mountain, the goblin, the knights, and the fairy sing the song "Dragon Mountain".
They walk all the way up to the large opening and look inside. The mountain is filled with lava and dark, black rock platforms. The four look around for the egg. The Grabbing Goblin finds the egg, broken and shattered with nothing inside. They look around for what was inside, but they come across a large green dragon instead. They all run away in different directions. The dragon, which is actually the egg in his older form, thinks that the medieval characters are playing a game of tag. He chases them playfully.
The adventurers are terrified. They all scram and run away faster. The dragon is very excited. After a while of running and screaming, the four questers begin to realize that they have stopped at a dead end - they are all standing at the edge of a cliff, and at the bottom lies a mile's worth of spiky rocks. The dragon comes after them and all expect that it is the end. The dragon does not eat them, though, instead he picks them up with his tail and gives them a ride to King Pablo's castle.
Dragon sings "Not An Egg Anymore" as the characters fly toward the castle. King Pablo is waiting for them. He is shocked when he sees the dragon, but quickly realizes that the dragon is his hatched egg. The knights, Flighty Fairy, and Grabbing Goblin all ask what the dragon should be named: Eggbert, Eggwin, or Eggy. Pablo tells them that he will be named Dragon. The king's stomach growls and his knights, thinking that the noise is coming from a monster, shout "En garde!" Pablo tells them that it is just his stomach and asks his friends if they want to come over to his house for egg salad. The four think that it would be cruel to have egg salad after just rescuing an egg. Pablo tells them he is just kidding.
The medieval land turns back into the backyard and Dragon disappears. The five characters sing the end song and go into Pablo's house. Uniqua and Tyrone open the previously closed door and shout "We're knights, that's right!"