Fred is installing an intercom system in the guest house and in the Ricardos' house. Meanwhile, Ethel begins resenting Lucy's friendship with Betty Ramsey after learning that she wasn't invited to a party that Betty was throwing for some neighbors.
Lucy begins to understand why Ethel is in a tiff and tries smoothing things over by giving a luncheon for Betty and Ethel. After some tense exchanges, Ethel discovers that Betty is also from Albuquerque, New Mexico, and that they know the same people. The two from that point hit it off and begin to get chummy. Lucy, however, ends up feeling left out as Ethel and Betty begin spending more time together.
Bruce and Little Ricky enter the Ricardo house and Little Ricky turns on the intercom show Bruce how he has been able to communicate with beings from outer space, and accidentally leaves it on. Lucy enters and overhears the Mertzes mention a housewarming gift and mistakenly thinks that Betty and Ethel are planning a surprise housewarming for the Ricardos. She and Ricky get all dolled up, awaiting the guests and practicing their surprised looks. They leave the house for about twenty minutes to give everyone a chance to get in place for the "surprise party." When they return and find no gifts or guests, Lucy realizes that there never was going to be a housewarming party and bursts into tears. Ethel overhears through the intercom and begins rounding up gifts and enlists Betty's help to call neighbors at the last minute for Ricky and Lucy's housewarming party.