The episode begins inside the HTF's kitchen before school where Giggles is baking cupcakes to bring to her teacher at school. Lumpy and Cuddles think Giggles is trying to butter up her teacher but she is just being nice. On the school bus Giggles makes Cuddles suck up to her in exchange for a cupcake. Once at the schoolyard Giggles shows off her cupcakes to her friends and one of Flippy's minions steals the cupcakes away and begins to eat them. Cuddles comes over to Giggles' rescue and attacks the bully. Flippy then comes over to break up the fight; he picks up Cuddles and skins him. One of Cuddles' punches lands and gives Flippy a bloody nose. Everyone gasps after seeing what Cuddles has unwittingly done. Flippy tells Cuddles he will get him after school. Inside the classroom a worried Cuddles (now with his skin back) daydreams about the showdown with Flippy after school. In the dream there is nothing Cuddles can do to defeat Flippy. Toothy wakes Cuddles up in time to go to lunch. In the lunchroom everyone hails Cuddles as a hero. A modest and nervous Cuddles downplays the situation. Flippy walks up to a trembling Cuddles to remind him about the fight after school. Back in the classroom Cuddles daydreams again this time about his own funeral in which his friends mourn him, and Flippy stabs him one last time. After school a nervous Cuddles darts around the playground hoping to avoid Flippy. Cuddles turns a corner only to see Flippy standing right in front of him. Flippy promptly knifes Cuddles, throws him in a trash can, and informs Cuddles to meet again tomorrow after school for another killing. Flippy and his minions roll Cuddles away in the trash can.
The garbage can with Cuddles inside rolls to a stop in front of the HTF house, and a weary Cuddles stumbles out and goes inside the house. Once inside Cuddles walks past his friends in the living room and heads to the bathroom to cry. Petunia sends Lumpy in to console Cuddles. Cuddles eavesdrops on the conversation and when it is revealed that Flippy is picking on Cuddles she bursts in and gives Cuddles advice. She advises him to talk nicely to Cuddles and try to settle things like gentlemen. Lumpy doesn't like this advice and he takes Cuddles into another room and shows him how to fight HTF style (which is fighting dirty). The next day after school in the schoolyard Cuddles uses Lumpy's advice and flings mud in Flippy's eye which only makes Flippy mad. Flippy kills Cuddles again, throws him into another trash can and rolls him away. Once again in front the HTF house Cuddles' trash can rolls to a stop. Giggles is sitting out on the sidewalk and suggests that Cuddles should go and seek The Mole's advice. Cuddles goes to the retirement home and visits The Mole who is angrily typing a letter to TV advertisers. The Mole tells Cuddles to just stand up for himself. Wrinkles quickly enters The Mole's room and demands for The Mole's newspaper. The Mole says no and stands up for himself, but Wrinkles takes the paper away anyway. Realizing that Cuddles standing up for himself might not work, The Mole says he knows someone else who can help. The Mole and Cuddles go over to Kiwi's Military Antiques to ask Kiwi for advice. Kiwi tells them that Cuddles needs to start a small army and they begin to devise a plan.
At school at note is passed around class. The note tells the kids that anyone fed up with Flippy should meet at Cuddles' treehouse after school. Inside the treehouse a group of kids along with Kiwi and The Mole wait for Cuddles to arrive. Cuddles stumbles in after being beaten up again and rallies the recruits and encourages them to join in his battle plan against Flippy. A montage of army marches, drills, obstacle courses, and training with Cuddles as the drill sergeant commences. Back inside the treehouse, days later, the battle plan is being finalized by Cuddles, Giggles, Kiwi and The Mole. Guddles steps in and informs Cuddles of Flippy's whereabouts, and the battle plan begins. Outside on the streets Cuddles confronts Flippy and out of nowhere Cuddles' army appears with water balloons much to Flippy's surprise. Water bombing takes place and Flippy is captured. Cuddles wheels a tied up Flippy in a wagon back to the HTF house. Cuddles tells Flippy that he hoped he has learned his lesson and reaches to untie him, but Flippy says as soon as he is free he is going to pound Cuddles. Inside the HTF house Kiwi draws up a peace treaty between Cuddles and Flippy which they both sign. Petunia steps in and hands out cupcakes to everyone for a happy ending.
At the end of the episode, Cuddles sits on a table in a library and talks directly to the camera about the seriousness of war.