Fat Albert, Mushmouth, Rudy, Bill, and the Cosby kid gang are rehearsing their Christmas play in their junkyard clubhouse when suddenly Mr. Tyrone, who owned the junkyard as well as the whole east end of town, show up and threatened to have the clubhouse bulldozed to the ground. Then, a little boy, Marshall; his dad, and his very pregnant mother show up. They had car trouble and they wouldn’t take them because they were poor. So Fat Albert offered to take them in while he went to go bargain with Tyrone, but that mean old grinch simply wouldn’t listen. It takes Mudfoot to talk some sense into him and melt that icy old heart. Back at the clubhouse, the baby is soon born and in comes Tyrone full of Christmas spirit! Hey, hey, hey!