Fozzie Bear has a new rollerskating act, but since he doesn't know how to skate, he spends the entire episode careening around backstage. He eventually manages to roll out onto the stage to tell his jokes, but when he gets too ambitious and tries to skate backwards on one leg, he falls off the stage.
Kermit cancels the show in order to audition new acts. Guest star Steve is angry at first, but he goes on to perform for the cast. Fozzie worries that Kermit plans to hire replacements, especially after the audition of a canine comedian, Baskerville the Hound. Kermit tells Fozzie that he should appreciate seeing another artist's work -- until Lenny the Lizard auditions as a new emcee. A young singing girl, called Mary/Terry/Carrie Louise, is systematically removed off, when she makes an attempt of audition with her croaking partner.
Miss Piggy hires Scooter to pay off the audience to go wild for her. She also has him send her dozens of bouquets and write her piles of fan mail, all part of an attempt to get Kermit to notice her more. Piggy and Scooter stage a conversation for Kermit to overhear, in which she pretends to have an offer from another show, but Kermit isn't fooled. After finding out from Scooter what's really going on, he tells Piggy he's heard about her offer and has decided to let her go. When she breaks down in tears, sobbing that she can't leave him, Kermit agrees to take her back, but at a lower salary. After all, if she can afford to have Scooter pay off the audience for her... Miss Piggy gets hysterical and depressed, but is refreshed by Dom DeLuise.
Robin wants his own spot on the show, but his uncle Kermit doesn't even notice him with bigger costars like Thog, Sweetums, and Timmy stomping around. The little frog even tries to run away but just ends up locked in his own suitcase. When Bernadette Peters notices him and tries to cheer him up, however, Robin finds out that all the Muppets believe in him. He becomes so confident that he demands to sing "They Call the Wind Maria," but Kermit settles on a cute, little song called "I'm Five" instead.
Gonzo catches a cannonball with his bare hand, which stretches his arm out. Fozzie and Floyd crack jokes about the situation. Gonzo turns to John for help, but John ends up pulling the rest of his limbs out to match. Meanwhile, John isn't pleased with being on the show. He's tied to his chair before the show, he complains about the number of pigs and monsters on the show, and he gets roped into doing a closing number.
Fozzie Bear is so intimidated by the thought of meeting Milton Berle, "the King of Comics," that he spends the whole show hiding from the guest star. His flimsy disguises don't fool Kermit or Scooter, but when Fozzie finally overhears Milton saying that he'd like to do a song-and-dance with him, Fozzie springs out of hiding, and the pair performs "Top Banana" together in baggy pants and big shoes.
Madeline tells Gonzo she thinks he's terrific on the show, and the ego-starved Gonzo instantly falls in love with her. He drops in to Miss Piggy's dressing room to tell her he no longer has a crush on her, which pleases her until she finds out that he likes someone else. Gonzo's obsession takes him to the brink of marrying her until hearing her comments to Kermit of his going off the deep end breaks his fragile heart.
Kermit is hassled by Daily Scandal reporter Fleet Scribbler, who blackmails his way backstage at The Muppet Show and is determined to spin everything he hears in a negative light. He even offers Miss Piggy a picture spread if she'll give him the real dirt on the Muppets. Soon, even the Swedish Chef is talking to Fleet, who answers in mock-Swedish.