Timon and Pumbaa are at a mall at Christmas time looking through a video game store. Timon wants one of the video games called Vinchenzo 64, but sees that it's expensive and they can't afford it. Pumbaa then suggests that he becomes Santa Clause and Timon becomes an elf, knowing that the real Santa will give them presents for entertaining little kids.
Timon, dressed as an elf, and Pumbaa, dressed as Santa Claus, are at Santa's throne and Timon introduces the children to Santa. As he's playing an elf, Timon's job is to make the kids take turns to talk to St. Nick (and giving the kids some candy cane).
Pumbaa sees Timon hurting a boy who is shown to be eager to talk to Santa and hits him with a candy cane. Timon then lets the boy enter. Then the meerkat sees a girl clapping and tells her to stop, but then the girl wants to play with Timon. When Pumbaa calls the girl, the girl's mother asks Timon to watch her baby, who won't stop crying.
Later, a kid keeps trying to cut in line despite Timon telling him not to do so. After the third time the kid cuts in line, Timon warns him, as well as the other children, that he's going to tell Santa not to give them any presents but a gift certificate for the homework store. The meerkat is proud of himself for what he just did and decides that there should be some changes.
Timon makes the children pamper him and he becomes very demanding, especially to a little girl whom he tells that he will officially close the line if she doesn't bring him cookies as well as not allowing her to see Santa for not giving him the right cookies. Then one of the real Santa's elves shows up and scolds Timon for the way he's treating the kids. When the meerkat doesn't seem to care, the elf reveals to him that he's on the naughty list and disappears. This makes Timon realize that Santa does exist and that he's never gotten any presents due to his bad behavior throughout the years. He then decides to get into the Christmas spirit and make it to the nice list.
Timon starts doing a lot of good deeds at the mall, which are disguising himself as a doll for a little girl, directing traffic, wrapping Christmas gifts, and eating one of an elderly woman's fruitcakes. He also tries prevent the Christmas tree from falling.
At the end of the day, Pumbaa gives Timon a check for doing all the good deeds. Timon, however, cares more about his niceness than money. He decides to donate his check and after doing so, the elf appears and gives the meerkat the Vinchenzo 64 he wanted.
Timon, Pumbaa, and the elf are at the video game store playing the Vinchenzo 64. Then the Christmas carol shows up and once again scares Timon with their singing. Timon has had enough of the carol and makes one of the weapons in the video game explode on the group. The elf glares at Timon for what he just did and the meerkat tells him that he has all year to make the nice list again.
The Vinchenzo 64 is a parody of the Nintendo 64 console.