A snowman named Joe Snow recounts how the Muppet Theater was going through financial hardship, and the Muppets seeking Kermit the Frog for guidance. Kermit eventually feels he is not useful to anyone and an angel named Daniel brings this up with his Boss as they review what has gone on with Kermit in the past hours. Hours earlier, Kermit prepares a Christmas show with his fellow Muppets with Bobo the Bear playing Santa Claus. Kermit is approached by Rachel Bitterman, a banker/real estate agent who says that she will foreclose the Muppet Theater if Kermit does not pay her. Pepe the King Prawn leaves the Muppets because he has fallen in love with Bitterman. While trying to raise money to pay Rachel, Kermit tries to find a celebrity to participate in his Christmas play to no avail. Meanwhile, after learning from Pepe that the deadline is midnight, Bitterman changes it to 6:00 p.m. When he sees her with another man, however, Pepe leaves her and warns Kermit about the deadline change. Upon learning this, Kermit sends Fozzie to deliver the money to Bitterman. Fozzie confronts a crazed nature-show host, Joe Snow, and a gang of Whos after being dyed green at a Christmas tree lot and mistaken for the Grinch. Fozzie goes through the steam baths and ends up back to normal. When Fozzie eventually makes it to the bank and Bitterman's office, he goes through a gigantic web of burning lasers leading to Bitterman's office several times before finally discovering that he's too late and that he has grabbed the wrong bag containing clothes for the Salvation Army following his incident at the Christmas tree lot. After witnessing these events, the Boss allows Daniel to help Kermit. When Daniel arrives, and after Kermit wishes he has never been born, he ends up showing Kermit what would have happened if he had not existed. In the world without Kermit, Bitterman has turned the park near the Muppet Theater into a shopping mall called Bitterman Plaza, the Muppet Theater itself has become a nightclub called Club Dot owned by Bitterman, Doc Hopper's French-FriedFrog Legs has become a famous fast-food restaurant, and all of Kermit's friends have fallen into various detrimental situations. Kermit has Daniel restore him back to his reality and returns to the Muppet Theater. However, Bitterman arrives to shut the theater down and fights with Miss Piggy. Pepe arrives and announces he has made the Muppet Theater into a historical landmark, foiling Bitterman's plan. Embittered and defeated, Bitterman storms out of the Muppet Theater. Outside, the Muppets and Joe Snow sing "We Wish You a Merry Christmas".
Cast
David Arquette as Daniel, an angel who appears to Kermit at Christmas
Joan Cusack as Rachel Bitterman, a spoiled, rich young banker
Matthew Lillard as Luc Fromage, a foppish French choreographer
Veteran Muppet performer Jerry Nelson was ill during filming, so most of his characters were puppeteered by others and later dubbed by Nelson in post-production. The exception was Nelson's character Lew Zealand, who was performed by Bill Barretta. Scooter, performed in the film by Brian Henson, makes his first major appearance since the death of his initial performer, Richard Hunt. Hunt's character Janice was also performed by Henson and has a speaking role for the first time since Hunt's death. The film contains an original song, "Everyone Matters", performed by Kermit and Gonzo as part of the world in which he had never been born, and then reprised at the end. The film also makes reference to the classic Muppet song "Rainbow Connection", featuring a statue of Kermit in a park, erected in dedication "for the lovers, the dreamers and you".
