Episode One: The Beginning of Fifth Grade The movie is split into three different episodes/sections. The first episode begins with the Recess gang starting the fifth grade. At first thought to be the best year ever, they soon discovered otherwise. First, Ms. Finster becomes the fifth grade teacher instead of the desired Mrs. Milkie, who had transferred. This is combined with their lockers being taken away, the cafeteria food being substandard, and the playground being removed. In response to these atrocities, T.J. goes to see Principal Prickly, who says that he couldn't do anything because it was the school board's policy. Consequently, T.J. claims that he would stay in his room and never go to school again. Word soon gets out, compelling every student at Third Street to gather at T.J.'s house. Prickly tries to compel T.J. to come down, but the school board finds out and dispatches Mr. White (from the episode, "The Story About Whomps"). Mr. White claims that he'll allow T.J. to remain in his room, but promises that his friends will suffer for it. T.J. then seemingly concedes, allowing Mr. White in his room, only to find that T.J. climbed on top of the roof. Unfortunately, T.J. almost falls off the roof, but Prickly saves him. It is then that Prickly decides to join T.J.'s protest. The board members find out that nobody likes the policies, but they were just things that the board members were too afraid to stand up to. They then vote to alleviate the policies, much to the dismay of Mr. White, having been beaten by a kid a second time. Afterwards, things at Third Street are returned to normal, aside from having Ms. Finster as a teacher.
Episode Two: The Fifth and Sixth Graders Club In the second episode of the movie, the gang is introduced to the fifth and sixth graders' club, where both grades can cooperate. At first T.J. and the gang think that they are going to like it (in part because Randall is banned for being a snitch), but they soon start getting sick of it. However, Mikey and Gus still like to hang out with the other fifth graders. T.J., Spinelli, Gretchen, and Vince start getting tired of the jokes everyone makes about the younger students. In response, they get King Bob (the former King) to get them into the fifth and sixth graders' club before everyone else arrives. But T.J. and the gang bring two first graders, Tubby and Hector, who were Mikey and Gus' respective friends. King Freddie II bans them from the Fifth and Sixth graders club, but they are glad that everything is back to normal.
Episode Three: Halloween In the third and final episode of the movie, Spinelli and her parents go to a pumpkin patch where Spinelli picks an ugly pumpkin for Halloween. Lawson and his gang are also at the patch, telling Spinelli that she is too old for Halloween and that they are only there to throw the pumpkins, not make them into lanterns. She too believes that she is too old for Halloween, and consequently asks her parents to leave. However, her parents tell her that they have to get a picture of her sitting on a giant pumpkin like they have done since she was a baby. Guilted into it by the baby pictures, Spinelli sits on the pumpkin, but it gives way and bursts under her weight. Seeing this, Lawson begins to laugh at Spinelli. Back at school, T.J. and the gang are talking about Halloween, Gus stuck on what he is going to wear. Spinelli comes in and says that she is too old for Halloween, eating her lunch and going away. The gang remembers all the good times they had with her on Halloween. Halloween finally comes and Spinelli's parents are going out while she is staying home. While she is watching a movie, the diggers knock on the door, see her expression, and tell her that they will tell the other kids to skip her house because she is not in the Halloween spirit. However, she tells them not to warn the other kids so that she can pretend she is scared. When the next lot of kids come and she pretends to be scared, the kids are not meant to be scary. In return, she scares them by wearing a scary mask and screaming "Take candy and go to the next house". She then closes the door smiling. When the next group of kids comes, she gives them tips for being dinosaurs by putting ketchup over their suits and telling them to roar from the stomach. The next trick-or-treater is a werewolf who howls and actually scares Spinelli. However, the werewolf takes off its mask and it is actually Miss Finster. She comes in looking for Spinelli's parents, giving her advice about Halloween and that some people, like her, never get too old for it. She then gives Spinelli her phone number in case her parents come home early, and then goes out trick-or-treating. Meanwhile, T.J. and the gang are out trick-or-treating, Gus wearing toilet paper as a costume. Their worries over Spinelli have ruined the magic of Halloween, along with the discoveries that someone is giving out sugar-free sweets, a building they thought was a haunted jail is really a closed down DMV, a zombie is really a robot, and gravestones are really just wood. They go home disappointed until Spinelli finds them and brings them to a home which they used to believe vampires inhabited. She persuades them to go in and the door locks behind them. Spinelli then goes into a door and screams while various monsters advance on T.J. and gang. One of them is the werewolf, who is once again Miss Finster in disguise and the other monsters are all the other teachers. They give the gang a heap of candy and the gang's Halloween spirit is restored, while outside Lawson and his gang are scared off by Miss Finster's wolf howl.
Closing The film cuts later to another day of school where T.J. and the gang play a calm game of kicking the ball to each other during recess until the bell rings. As T.J. and his friends, along with Miss Finster and the other children, go inside the school to their classes, T.J. narrates that even though things change as they grow up, sticking to what they believe and staying true to themselves will make everything okay. And as Miss Finster is about to close the doors, T.J. waves to the audience saying he's got a feeling that it'll be the best school year yet, and that he really means it. Miss Finster then sighs, and as T.J. moves to his class, Miss Finster gently shuts the doors, thus ending the film.