The Oracle twins visit Grandpa's shop to warn Fu Dog and Jake about the Magical World Beauty Pageant that Eli Pandarus is sponsoring in his private island. Sara had a vision that Eli Pandarus was planning something horrible but since they don't have a clear view of Pandarus' plan, team Dragon along with Veronica travel to the island. Veronica will enter the pageant for them while Grandpa and Jake are ingonito as Veronica's stylist. When they arrive on Pandarus' island, Grandpa and Veronica go prepare for the pageant while Jake checks out the stage. Fu Dog begins to flirt with the other ladies but does so in a disrespectful way that Jake warns him to have class.
At the pageant, the Tooth Fairy, Jack Frost, and Santa Clause act as the judges. As Veronica is about to go on stage, she trips and breaks one of her legs. Grandpa has Fu Dog wear a wig to disguise him as a woman for the pageant. Since contestants who are eliminated get kicked off the island, Fu Dog must focus in order for him to win or stay in the pageant long enough for Grandpa and Jake to find out what Eli Pandarus' evil scheme is.
Midnight comes and Jake and Grandpa scale the walls of the compound as they listen to Pandarus and Monty Hall talk. There is a secret altar under the stage that Pandarus will use to become the most powerful wizard. An ogre acting as Pandarus' guard unknowingly slams the window on Jake's and Grandpa's claws, making Jake fall when he frees himself. They fight the ogres that were meant to guard the building and fly away in clear view of Eli Pandarus, who is too confident of his plan to worry of them.
While they eat, Fu Dog shares that there's a trap door in the middle of the stage and is only accessible during the stage since the arena is heavily guarded. Back at the dressing room, Fu Dog disguised as Fuella accidentally bumps into Eli Pandarus who calls him/her a ditzy dame, much like Fu Dog called a sprite earlier when she refused his advances. Fu Dog gets emotional about Pandarus's comment, earning the comfort of the other contestants.
During the show, Jake and Grandpa hide under Fuella's dress and find the trap door, which leads them to a series of tunnels. Grandpa and Jake run to the tunnel that leads to an altar where a stone tablet containing the Prophecy of Connubis is found. Pandarus' ogres find them but they're captured within a net of sphinx's hair launched by Pandarus, who plans to marry the winner of the pageant in order to complete the prophecy.
When Fu Dog/Fuella begins to complain in the dressing room, Iris begins to cry from lack of confidence in her beauty. Fuella comforts her but is pulled onto the stage to do the Personality Contest. When Fuella is humiltiated on stage, Fu Dog/Fuella becomes upset and begins to say a speech of how the women around him should be defined by their intelligence. The other contestants rebel against Eli Pandarus for creating a whack pageant and cheer for Fuella to have the crown. Fuella is crowned as "The Fairest of Them All".
Eli Pandarus grabs Fuella and heads for the alter, revealing his plans to marry Fuella to become the most powerful wizard. Fu Dog takes off the wig to reveal himself, but Eli Pandarus plans to marry him anyway. Under at the altar, Jake and Grandpa are chained to the wall to be witnesses for the wedding. As the leprechaun, who is giving the ceremony, asks for objections, the other contestants arrive to rescue Fu Dog, despite their disgust for him due to his earlier actions.
The other contestants free Jake and Grandpa, and they battle against Pandarus' ogres. Pandarus surrenders and hands them Fu Dog. At the boat launch, the other contestants thank Fu Dog for standing up for them. Fu Dog comments that he was better as a woman than a dog but continues his womanizing tendencies.