When George breaks up with his girlfriend he sends Jerry to retrieve some books he left behind at her apartment. Jerry falls for George's ex and they start dating but break up when she reveals to Jerry that she doesn't find his stand-up act funny.
Jerry and Elaine attend the 50th wedding anniversary of a family acquaintance. Jerry offends the wife by making an off the cuff comment about children who had ponies as pets as she had one as a child whom she adored. The lady becomes very upset and dies soon after, leaving Jerry to worry whether his comment caused her death and whether she should go to her funeral.
Jerry buys a new suede jacket at a great price but it has a colorful inner lining that leaves much to be desire. George can't get a song from "Les Miserables" out of head. As Elaine is doing a favor for Kramer, the two of them have to pick up Elaine's overbearing father who reacts negtively both to George's singing and Jerry's colorful coat lining.
George regrets not going upstairs for 'coffee' to his date's apartment and ends up leaving an embarassing message on her machine that he later regrets so he and Jerry think of a way to get rid of the tape. Jerry is also having problems with his girlfriend as she likes the commercials for Dockers pants and he doesn't.
Jerry helps Elaine get the newly vacant apartment above him, but becomes concerned when he starts to think of what it would be like to have Elaine as a neighbour. George starts wearing a wedding ring to attract women.
When Jerry finds an old statue in a box belonging to his grandfather, George wants to have it as it looks identical to the statue he once broke belonging to his parents. When Jerry hires the boyfriend of Elaine's new boss to clean his apartment, however, the statue goes missing. The statue is seen at Elaine's boss' house but Elaine doesn't want George stealing it back.
George quits his job after being demoted to having to use the regular bathroom but then is upset when his boss doesn't rehire him. He schemes with Elaine to get back at his boss. Jerry suspects that a man at the laundromat is stealing money from him and plots with Kramer to get back at him.
George is convinced that he's had a heart attack but the doctor tells him that he just has to have his tonsils removed. George balks at the cost of the procedure and visits a holistic healer on the advice of Kramer. Elaine fancies George's original doctor.
Elaine and Jerry attempt to put rules in place whereby they can still maintain their friendship while starting a physical relationship again. George thinks it is impossible and Jerry starts to have doubts when he can't figure out what kind of present to buy Elaine for her birthday.
Jerry lets Elaine use his apartment for a baby shower when he heads out of town for a show. All havoc breaks lose when Jerry's trip gets cancelled and Kramer, Jerry and George show up at the shower: Kramer coming to install illegal cable and George confronting the woman he once dated, whose baby shower it was.
Jerry, Elaine and George have a series of misadventures while waiting a painfully long time for a table at a Chinese restaurant.
Elaine decides that her houseguest has overstayed his welcome and tries to figure out how to get him to leave. George inadvertently meddles in the life of a busboy, first by getting him fired and then by losing his cat.