Greg sneaks Coolidge High's mascot, a goat named Raquel, into his bedroom. He and his teammates stole Raquel in retaliation for Coolidge stealing their mascot. Now Greg is lumbered with the task of keeping Raquel hidden in his bedroom until after the game. It is something he begins to regret when Raquel starts eating his things, including his American history report. And he soon finds problems in handling her and keeping her hidden.
At breakfast, Mike reads a newspaper report that Coolidge High has stolen Westdale High's mascot. The news about Westdale stealing the Coolidge mascot in revenge has not yet broken, so Mike is surprised they have not done so; in his day, they would have. As a matter of fact that was exactly what he did, and it earned him a one week suspension. Greg is pleased to find his father is a kindred spirit, but Carol is not so approving, and is not impressed with the mascot-stealing either.
It is not long before other family members start to rumble the presence of Raquel. Peter and Bobby discover an air vent in the linen closet where they can hear everything in Greg's room. They overhear Greg talking to Raquel and mistakenly think it is a girl in Greg's room. Later, Marcia calls in on Greg, and Greg has no choice but to show her Raquel. She agrees to keep it secret. Then Mike accidentally overhears Greg talking to Raquel from the air vent and draws the same conclusion as Bobby and Peter. He confronts Greg, and Greg explains that Raquel is the Coolidge mascot and not a girl. But this is an awkward position. Mike tells Greg he has to return Raquel, but Greg asks if he can do so after the game, otherwise the other boys will be angry with him. Mike reluctantly agrees - as long as Carol does not find out. After all, he did the same thing at school.
Then Carol tells Mike that word has got out about Westdale stealing the Coolidge mascot. An emergency PTA meeting is being convened over the matter at Mrs Gould's house. Worse, vice-principal Mr Binkley feels an example should be made of the culprits and will be at the meeting as well. Mike tells Greg (while they are cleaning up more things Raquel has chewed). Mike says the only way to take the heat off is for the Westdale and Coolidge boys to make arrangements to return each other's mascots. He goes with Greg to arrange the mascot exchange. The Coolidge boys are only too happy to do so as they feel the same way and fear getting into trouble.
But while Greg and Mike are out, disaster strikes twofold. First, Peter and Bobby go into Greg's room to investigate the bleating and four-footed footsteps they hear from the vent. As a result, Raquel escapes the attic, goes through the house, where Alice and the other kids see her, and through the garden and out the gate. Second, the PTA meeting moves to the Bradys' house as Mrs Gould's was not available. When Mike and Greg return, Mike hastily takes the ladies on a tour of the house. Greg opens the door to Mr Binkley and takes him to the den where the ladies are. Then Raquel comes back, and when Greg comes out from the den, he sees her go up the stairs.
Hijinks ensue as Greg keeps trying to catch Raquel, who is not proving easy to catch, while Mike tries to keep the PTA and Mr Binkley busy with the house tour. Carol discovers Greg and Raquel hidden in the closet. Now she knows the truth, but has to join in the hijinks to keep the others from finding out while Greg tries to get rid of Raquel. But eventually they discover the truth when Raquel gets away from Greg and runs right in front of their eyes. Mrs Gould gets a fright (especially when she is accidentally shut in the same closet as Raquel), Carol is furious, and Greg has some serious explaining to do to Mr Binkley.
Mr Binkley is impressed with Mike's quick action in arranging the mascot exchange and mitigates Greg's punishment to a 5000-word punishment essay. He then reminds Greg he has an appointment with the Coolidge boys, and Greg rushes off to get Raquel. While Greg is gone, Mike tells Mr Binkley how times have changed; when he did the same thing at school, he was suspended for a week. Mr Binkley says he was suspended for an entire month!
Afterwards, Alice and Carol have to do some serious cleaning on Greg's room because of Raquel, including getting rid of her smell with air freshener. Greg then discovers another souvenir of Raquel - the enormous hole she ate in the seat of his jeans!