Nat needs to shake his gloom and find Christmas spirit before a Save the Children benefit.
The episode begins with Alex greeting the viewer a Merry Christmas, while Nat explains how their dad transformed their house into a winter wonderland on a average, sunny day in New York. They all proceed over to the ice skating rink while Nat reveals about their annual Christmas Party for the Save the Children charity benefit. While showing off his dance moves, Mr. Wolff slips while the brothers come in and join him.
Alex is seen watching The Timmerman Brothers new music video "My Mistletoe Hat" featuring Jesse, which distracts Nat from writing a motivational song for the party. He is in disbelief over it being the #1 most watched video on the Internet, and shows Nat it's record-breaking views, making it beat another viral video. Nat then notices the negative comments below the video, which gives Alex the idea to write a "bad Christmas song" to beat the Timmeran Brothers and teach them a lesson about using Jesse in her video. In contrast, they all come over in joy that their in the #1 most hated music video ever. The Timmerman Brothers go ice skating as Alex tries to brag to Jesse over making a worst hit than them and not allowing her to be in it.
At bedtime, Nat looks over his Christmas-themed video postcard to send to Rosalina, and then checks over to Alex in the process of writing his bad Christmas song. He then finds out that Alex didn't tell him about his postcard from Rosalina to save him from heartbreak over her only writing two X's. Nat wants to immediatly confront Rosalina about this, but Alex stops him to avoid desperateness or conforming to her X's.
The next day, Nat yet again is distracted when his Dad tries to inflate a Santa balloon and gets frustrated. Sonny then shows off his mistletoe hat in hopes to earn kisses, which Alex makes him replace it with a termite hat. Nat gets upset over the noise, while Alex tells his Dad about his love troubles about the X's. Unfortunately, he gets reminded of Betty for a bit, but quickly informs Nat about another postcard from Rosalina. Alex swipes it from him to read, and reveals that Rosalina signed the card with only one X, leaving Nat in shock.
Later, Thomas (dressed as Santa) and David (dressed as an elf) are at the house to begin shooting for Alex's new music video to "Termites Munching On a Christmas Tree". Qaasim and Sonny are dressed up in termite costumes as background dancers, while Jesse's plan to blend in the video backfires, which causes Alex to cut the shoot.
That night, Cooper tries to convince Nat that "Christmas Stinks" is not the best song for the Christmas benefit in which he doesn't consider about as he complains about people profiting off of the holiday while flipping through various advertisements on TV. He then rants after being reminded by Cooper about his lack of X's until they focus on a newscast of a Brooklyn teenager, 14 year old Leon Williams, singing for non-profit. He turns off the TV still completely bummed as he comes across Alex reading slightly positive comments of his video, gaining more favor over the Timmerman Brothers video.
The charity benefit has begun with various people seen with the mistletoe hat on, although Sonny and the rest of the boys wear their termite hats in support of Alex. Nat and Cooper are on the rink discussing Nat's failure over writing a inspirational song, although he gets compliments from party guests over hosting the party. Meanwhile, the Timmerman Brothers are in awe of people wearing mistletoe hats while Jesse goes to taunt Alex over the kissing trend her video started. This angers Alex to the point of attempting a snowball fight, which quickly halts when Whoopi Goldberg gathers the guests' attention. She shortly introduces herself as the party host, and informs people about the preformance by Nat and Natasha Bedingfield and the Save the Children Benefit.
Natasha then comes over to Nat to go over their song, and is confused over the title. Whoopi shares the same feeling as she announces the song's title to the audience. Right before the preformance, Natasha shares her discomfort about the song, and leaves Nat to preform the song himself. The whole audience appulads Nat to the stage, and the song is then revealed to be written about his frustration and confusion over Rosalina X's. Whoopi shares her criticism to Cooper of the song, and calls it the worst Christmas song ever, in which Alex is happy about. Nat then confesses to Whoopi his love problems, which then she announces to the audience. The news makes a group of teenage girls excited and try to comfort him. Nat then ignores the attention and tries to apologize to everyone especially Natasha and Whoopi over the song, but is stopped by Alex as he expresses his joy over him writing a worse Christmas song than him and plans to make a video the next day. Jesse asks to be in the video, and Alex quickly declines her request when the power suddenly goes out. Mr. Wolff then annouces that a fuse has been blown, and urges everyone to pull out their cell phones in the meantime.
Nat tries to get away from the crowd when he bumps into Leon Williams in the ice rink, only been slightly familar with him. He pours out all his love troubles to him while Leon tries to tell him to not focus on the X's when the power comes back on. Whoopi then gathers the audience attention once again, and introduces them to Leon, a teenager who lived in poverty his whole life, which re-freshes Nat's memory about him being the caroler. She then goes on to bring Leon to the stage to preform Yes We Can. He begins tells the audience an inspirational message while Nat then proceeds to go over to his keyboard and write a composition of the song to share with Natasha. Meanwhile, Alex then apologizes to Jesse and agrees to put her in his next video. He gets into the Christmas spirit with Mr. Wolff by giving up the Termite hats, and kissing under the mistletoe hats. It quickly cuts to Nat, Natasha, and Leon preforming Yes We Can. After the song finishes, he thanks Leon for brining his spirit in Christmas back, and the trio rejoice over the audience's applause.
Later that night, Alex finds out that Nat decided to send Rosalina a video card after having learned from Leon. Immediately, he gets a video reply from Rosalina singing a song to the tune of Jingle Bells, and signs it with three X's. Nat and Alex is estatic over the video card just when the fish wake up and it starts to snow outside, meaning that Christmas has officially begun as they celebrate in glee as the episode comes to a end.