Doc has hung lots of seaweed in the workshop. There is a small fan blowing it to dry it off. Sprocket is laying in his doggie basket, repulsed by the bad smell of the seaweed. Gobo enters the workshop for his postcard, but sees the seaweed in the way and is also revolted by the smell. He runs back into the rock and tells Wembley, who has accompanied him, that the "beast" has a "magic wind weapon" (referring to the fan). He is determined to get his postcard, however, and rushes back out. Gobo manages to grab his postcard, but Sprocket sees him and gives chase. Sprocket and Gobo both get hung up by the seaweed in the way, yet Gobo manages to escape. Doc enters with more seaweed in a sack and untangles Sprocket from the seaweed that was hung up. He talks of cooking the seaweed as the seashore apparently has plenty to spare so they can have lots of nutritious things to eat.
Red is in the pool, trying to break Gobo's underwater breath-holding record. Boober, Mokey and Marlon are sitting nearby, counting for her. Red dives underwater as the other three count for her - although they each count at different speeds. Red resurfaces and announces she counted to "eleven rock beatles", apparently beating Gobo's record. The other three have each counted to different "rock beatles", but somehow Marlon convinces Red that she is indeed the winner. Gobo and Wembley return, and everyone is aghast at the bad seaweed smell that has "contaminated" Gobo and are anxious to hear about this. All except Red, who is still fuming about her breath-holding record and the bad counting process. While everyone is obviously more interested in Gobo's adventure into Outer Space, Red gets upset that she is being ignored and accuses Gobo of exaggertaing too much. Gobo and Red argue, and Red storms off. Wembley reads Gobo's postcard to the Fraggles. This latest adventure of Traveling Matt's has found him encountering a pair of human twins, to whom Matt claims as "Silly Creatures who have split in two". After the reading, they wonder where Red has gone off to and Gobo tells them not to worry, that "she'll be back hogging the spotlight in no time".
Red is walking down a tunnel, thinking about how she feels ashamed of having exaggerated and that she was only trying to have some fun. She ends up beside a lonesome pond with lillies blossoming all around and sings about how she misses being the center of attention. After the song, she expresses how lonely she feels. Then, something rises up out of the pond. It is dark purple and looks like some sort of tube-like proboscis. It blows at Red and scares her. She hollers for the others as she runs off to get them, excited to show them what she found. The tube-thing disappears quickly back into the pond.
Doc is busy cooking the seaweed and Sprocket is still trying to get over the bad smell of it. Doc offers to let Sprocket have a taste, but the dog refuses. Doc tells him that it is nutritious, claiming he doesn't know why everyone thinks he's exaggerating about the stuff.
Wembley is trying to play a guitar and isn't doing too well. Gobo and Boober tell him that it may be his hands are too small. Red pulls Mokey into their room and tells them all she found a sea monster. At first they are astounded, but when they hear her say it had a "magic wind weapon", then the doubts start flying. Red coerces them all to go see for themselves and they agree to go with her.
The Fraggle Five are sitting around the lily pond Red found, waiting for a sign of this sea monster. They are all still doubtful, especially Gobo, who starts pressing the issue, furthering Red's anger. They give up waiting and decide to go home, but Red refuses. Gobo calls her stubborn and they leave. Red stays behind and begins wondering if it really was her imagination. The proboscis thing rises up again, and Red doesn't back down this time. Then, the sea monster rises up fully to reveal itself. It is huge and looks like a dark purple dragon with webbed hands, the proboscis tube on top of its head. Red is bewildered by it. It talks to her and claims he is "the last of the lily creatures". Red scares it away yet again when she screams out a resounding "whoopee" and runs off to get the others again, the sea monster quickly submerging into the pond again.
Red is telling a bunch of Fraggles about her second encounter with the sea monster. Gobo taunts her and nobody believes her. Marlon does, however, and wants to go with her as he has ideas of his own about this creature of Red's. He and Red leave the unbelieving crowd of Fraggles behind. Gobo states that Red has "lost her sense of humor" and gets an idea.
Red and Marlon are sitting at the lily pond waiting for the sea monster. They see a purple fin coming toward them and Red gets excited. But it is only Gobo, who was swimming underwater wearing a makeshift fin on his head, completely playing a prank on Red. The others pop out of hiding also and laugh. Red and Marlon are furious. Red says Gobo is despicable and storms off.
Red has packed her stuff and tells Mokey and Gobo that she is going to live beside the pond until she can prove the sea monster exists. Mokey tries to stop her, but Gobo holds back, saying that Red has gotten herself too far into this situation.
Red shows up at the lily pond to find that Marlon has set a large net trap for the sea monster. He claims that they will be famous and Red tells him she doesn't want that kind of attention. She lies by telling him she made the whole thing up and chases him away. After he leaves, she gets rid of the trap. The sea monster once again shows up and thanks Red for protecting him. He tells her that since he is the last of the lily creatures he must live in peace or else he would die. He asks her to keep him a secret. She agrees, and he tells her she can visit him whenever the lillies are in bloom. He submerges and leaves again, leaving Red in complete awe.
Gobo and the others are sitting around the Great Hall feeling mopey about the whole Red ordeal. They start a sad, slow blues rock number on guitars as Mokey sings about missing Red. Red overhears them and enters, to the delight of all. Red tells them she made a mistake about the sea monster, that all she was trying to do was get attention. They start up their blues rock song again, this time a more cheerful upbeat version, singing about how glad they are Red is back.
Doc and Sprocket are laying on the floor, stuffed from eating a whole bunch of delicious seaweed dishes. Both seem very satisfied with the food they ate, and Doc tells Sprocket he may fix a dish from sea slugs.