An aircraft belonging to Shere Khan is hijacked by Don Karnage and his band of Air Pirates. Once aboard, Karnage steals the only item being transported by the plane; a small, gold trimmed box.
On their return to The Iron Vulture, the pirates' airborne hideout, Karnage promises his men the box will bring them riches beyond their wildest dreams. However before they are able to put their plan into action, a small bear going by the name of Kit Cloudkicker, drops down from a ceiling vent and steals the box from under Karnage's nose. Kit makes his escape over the side of The Iron Vulture using his trusty air foil to "surf" the clouds and hitch a ride on the back of a passing plane.
The plane lands at a bar called "Louie's" where Kit bumps into a large, overweight grey bear called Baloo. Baloo defends Kit when the pilot of his "free ride" comes looking for him and unwittingly comes to the rescue when the Air Pirates show up demanding their treasure.
Baloo flies Kit to the safety of Cape Suzette in his yellow sea plane, The Sea Duck. When they arrive at Baloo's house, Kit discovers that his new friend isn't exactly the tidiest and most organised person in the world, with old papers and unpaid bills lying all over the place. Baloo dismisses it all as "detailed stuff", but the reality of missing six loan repayments is soon brought into focus when the bank inform him that he has to raise $3,000 by 9am the next day or they will repossess the Sea Duck.
Baloo takes on a difficult job transporting Gorillabirds for the zoo in an attempt to make as much money as possible in the shortest amount of time. Once Baloo and Kit are out of Cape Suzette, however, the Air Pirates are back on their tail. Baloo manages to shake them off, but in doing so he is forced to crash land and his cargo escapes. While Baloo rounds up the Gorillabirds, Kit is captured by Don Karnage. Faced with torture, Baloo is forced to use his captured cargo as a diversion to rescue Kit once again.
Having lost the Gorillabirds, Baloo faces the prospect of losing the Sea Duck. Kit, grateful for everything Baloo has done for him, offers a share of his treasure so that he can buy the plane outright.