The Planet Express crew's latest mission is to deliver a crate to Professor Farnsworth's office at Mars University. While touring the campus, Bender comes across a chapter of his old fraternity, Epsilon Rho Rho (ERR). The nerdy fraternity brothers beg Bender for his help in the art of being cool, as "even Hillel has better parties than us!"
Fry finds out that his 20th century college dropout status is equivalent to only a 31st century high school dropout. Knowing this, he vows to enroll, and drop out all over again. In a scene straight from Animal House, Bender and the Robot House boys climb a ladder to peek in a girl's dorm window. A mishap happens when Bender's extendable eyes causes them to fall and crush Snooty House's servants quarters ("I say, you've damaged our servants quarters, and our servants").
Fry gets a room in the financial aid dorm, and finds his roommate Guenter is an intelligent monkey wearing an undersized hat. The Professor enters, and reveals that Guenter was the content of the crate, and that the electronium hat is the source of Guenter's intelligence. Bender and the Robot House members get called before Dean Vernon, who places them on dodecatuple secret probation.
At the parents' reception, Fry humiliates Guenter by releasing Guenter's unintelligent, feral parents from their cage. Later, Guenter expresses his unhappiness at his current life. At the 20th century history exam, the stress finally becomes too much for him, and he tosses the hat aside, jumps out the window, and into the Martian jungle. While Fry, Leela, and the Professor head off into the jungle to find Guenter, Robot House enters the fraternity raft regatta in a bid to lift their probation status.
When Guenter is found, the Professor offers him the hat, and Fry offers him a banana. Before Guenter can decide, Robot House speeds past with Bender on water skis. The boat's wake drags the humans into the river and towards a waterfall. Guenter puts the hat on and rescues them, but in the process the hat is damaged. Guenter announces that he likes the new reduced-capacity hat, and that he's decided to transfer to business school, to the horror of Professor Farnsworth. Robot House wins the regatta, and a parade in their honor is held, lead by an unhappy Dean Vernon.
The episode ends with a party at Robot House, and an epilogue stating that Fry successfully dropped out and returned to his dead-end job at Planet Express, Guenter successfully transferred to Business School and became CEO of the Fox Network, Fat-Bot caught a computer virus in Tijuana and had to be rebooted, Leela went on one date with Dean Vernon, but he never called again, and Bender, his job done, stole everything of value from Robot House and ran off.