Alternate-Universe Squidward appears several times during the episode. He appears whenever Squidward looks into something reflective (his glass, a mirror). He was the person Squidward took to the Galleria Diphtheria.
Shower In A Can!
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It is unknown what universe he is in; although it is likely that he is in the same universe as Alternate-Universe SpongeBob and Alternate-Universe Patrick. Alternate-Universe Squidward seems to dislike the real Squidward. It is unknown if he was an illusion, or a reality.