In Encino California, the French Narrator introduces the president of the SpongeBob SquarePants fan club, Patchy the Pirate, a live-action character who is currently preparing for Christmas, and his "pet", Potty the Parrot, a crudely made puppet with very obvious strings. Patchy shows two pictures of SpongeBob and Patrick, which fades to first: SpongeBob's Christmas setup and second: Patrick's rock with a tree ornament on it. Patchy receives a fan letter from a person whose name and address is withheld, asking if SpongeBob likes Christmas as much as he does. Patchy explains that they didn't always celebrate Christmas in Bikini Bottom, and decides to show how they were introduced to it, beginning the episode proper.
At Sandy's Treedome, Sandy is putting up Christmas lights. SpongeBob, who is in his karate gear and preparing to attack her, mistakes it for a fire, and then rushes inside, throwing water onto it. Sandy asks him what he was doing, and SpongeBob replies he believed there was a fire. Sandy is shocked that SpongeBob has never heard of Christmas, and tells him all about it.
Later, at the Krusty Krab, SpongeBob tells Patrick, Squidward, and Mr. Krabs about Christmas. Everyone in Bikini Bottom, except Squidward, believes him, and they all, except Squidward, put their Christmas wishes into bottles, which are then shot up to the surface so Santa can read it. In the days leading up to Christmas, the people of Bikini Bottom heartily celebrate, and on Christmas Eve, stand in front of the large decorated coral tree and sing, eagerly awaiting the arrival of Santa. Meanwhile, Squidward, refusing to believe in Christmas, is wanting no part of it. The people continue to sing until morning, when Santa has failed to arrive (which was much to SpongeBob's dismay).
Everyone leaves and SpongeBob becomes very depressed. Squidward appears, laughing and scoffing at his humiliation, and takes a photo of the heartbroken SpongeBob. As he sulks away, he gives Squidward a present. Squidward, now feeling sorry for SpongeBob, opens it, and finds a handmade driftwood clarinet. He now realizes that he is a "big jerk", dresses up as Santa much to the delight of SpongeBob. SpongeBob thanks "Santa" for bringing Christmas to Bikini Bottom, and Squidward tells him that he did. SpongeBob passes out from joy, and Gary carries him home.
Squidward prepares to take the costume off, but is confronted by a little girl, asking him for a present. SpongeBob suddenly appears beside her, assuring her that he will. Out of desperation, Squidward gives the child a wrench from his house. He then sees a crowd of people, who want their gifts as well, and ends up giving away everything he owns. Afterwards, Squidward finds a message from Santa on his doorstep, thanking him for his help and telling him that he's been a "good boy". He then sees the real Santa Claus (seen as a live action character) riding away in his sleigh. The dumbfounded Squidward says "Yep. I'm insane." and goes back inside, playing his new clarinet.
After the SpongeBob episode ends, Patchy's house is seen again. Potty gives Patchy a little present. Patchy steps under a mistletoe, hoping to be kissed by a woman, only for Potty to start chasing after him with the intention of kissing him. Seeing that Patchy is busy at the moment, the French Narrator says "Goodnight, and Happy Holidays." for Patchy.
On the Season 2 DVD, Patchy's line at the beginning of the second half of the show, "It's about time you got back! Now I can finish me story," is cut due to there being no commercials on the DVD. Four more scenes (or lines) were deleted as well. They all can be found on the Christmas DVD in the special features in the Christmas Who? storyboard.
Squidward (as Santa) gave the first girl a Squidward antique instead of a wrench.
While waiting in line for Santa (as Squidward), Mr. Krabs had a deleted line in this episode. He said "And don't forget about me pony!" This was cut for unknown reasons.
After Squidward gives the first girl the gift, SpongeBob says "I told ya he was real!" enthusiastically.
When they sing "This Christmas Feels Like The Very First Christmas To Me", instead of Plankton and Mr. Krabs singing together, two Bikini Bottomites sing together.
This is the first double-length SpongeBob episode.
When Sandy was explaining Christmas to SpongeBob at one point she looked like The Road Runner from Looney Tunes.
Netflix titled this episode, "Patchy The Pirate presents the SpongeBob SquarePants Christmas Special".
When Squidward feels guilty for bullying SpongeBob, he says "I feel like a..." and a picture of a donkey appears. This is a subliminal message that Squidward feels like a "jack***." A similar instance of this joke being used is in "Fools in April".
This is the second time Squidward feels guilty about bullying SpongeBob and apologizes to him. The first was "Fools in April."
When Squidward (dressed as Santa) was talking to SpongeBob, his eyelids briefly changed color for a split second to a lighter teal.
On the Season Two DVD, Patchy's line at the beginning of the second half of the show, "It's about time you got back! Now I can finish me story," is cut due to there being no commercials on the DVD.
In the episode "Jellyfishing" when Squidward came home Patrick yelled "Merry Christmas!", but he did not know what Christmas was until this episode. This seems to suggest that "Jellyfishing" took place after this.
SpongeBob and Patrick vandalized Squidward's property in this episode, as they cut down his tree, and decorated his house without permission.
When the fish were sending their letters to Santa, one fish said "I hope he can read Portuguese." However, it is unknown if he was heard speaking that language from Portugal.
This is the first episode to show Patrick with his one tooth (when he says "just like a genie"). Patrick's single tooth would later appear in more episodes, heavily used in post-season 5 episodes.
This is the third episode where SpongeBob, Patrick, Squidward, Mr. Krabs, Sandy, Plankton, and Gary (the main characters) all appear in the same episode. The first two are "Culture Shock" and "Sleepy Time".
In the Brazilian dubbing, the quote "I hope he can read Portuguese" was changed to "I hope he can understand my calligraphy", because Portuguese is the language spoken in Brazil.
Harold's shirt and speedos change from their normal white and red colors, to black in different scenes.
The title is a reduction on the holiday film Santa Who?.
This is the second time Squidward hints to viewers that he feels like a jack*** (subliminally) since this is a 'kids' show and it is inappropriate to say bad words, that is unless they are censored like they were in Sailor Mouth.
The reason Santa didn't come to Bikini Bottom is because the citizens didn't go to sleep, and it is said that Santa only comes when people are asleep.
Squidward saw Santa on his sleigh at the end, but it should be impossible for Santa to be able to breathe underwater. This could be why Bikini Bottom never heard about Christmas (with the exception of Sandy, since she is a land animal).
At the beginning of this episode, at the opening, Painty has a wreath around him and instead of saying the usual line, "Are you ready kids" he says, "Ready for Christmas kids?"
And, instead of him singing the opening, a female chorus sings the SpongeBob opening. Also, the logo card was changed to a Christmas title card.
SpongeBob and Patrick don't know Christmas in this episode, however, in "The Secret Box", Patrick hides an embarrassing photo of SpongeBob at a Christmas party. A possible reason for this is that this episode may have took place before "The Secret Box", though it is more likely that this is simply a continuity error.
It is rather odd that Squidward had a Santa suit, as Christmas was only introduced the day before. This seems to imply that Squidward made the Santa suit himself.
When Plankton throws away the fruit cake given to him by Mr. Krabs, it is poking fun at how unpopular fruitcake is even in the human world.
In some versions of this episode, the part when the puppeteer controlling Potty falls is cut out.
This is the last episode to air in 2000.
The music on the record player that Squidward has while he pretends to play to it, is the same song he played in Bubblestand.
The part where Patrick says "Just like a genie" has been an Internet sensation.
The little girl ask for her two front teeth this is a reference to "all I want for Christmas is my two front teeth."
Although Santa traditionally has eight reindeer, nine counting Rudolph, only four are seen or possibly the other four are next to the four seen.
When SpongeBob said "Where's your reindeer, and your flying machine?" Squidward only had 2 legs.
When SpongeBob gave Patrick his second sheet of paper, his shoes are transparent.
At first, Patrick was on the coral tree but when it was daytime, he wasn't there anymore. Patrick must have fallen off the tree.
Sandy was seen putting up Christmas lights at the beginning of the episode, even though she hibernates in winter. Though proved in Bubble Buddy, Sandy does hibernate during Bikini Bottom's spring, so when it was winter in Bikini Bottom, it was still autumn for Sandy, therefore it was not time for Sandy to hibernate.
Towards the end of the sequence where Sandy was telling SpongeBob about Christmas, bubbles were shown when she was moving. This is impossible, as they were in the treedome.
SpongeBob's tie is invisible in the sequence leading up to the picture being taken, and in the physical picture.
The photograph that Squidward took when SpongeBob was crying due to the fact of Santa not coming has multiple errors, when Squidward holds the photo the background around it is sand instead of snow; in the photo, the background is not the winter sky or snow, it is the typical sky that is seen in the other episodes, even though the coral tree is still visible. SpongeBob's tie is also invisible, possibly from the drooping nose.
When Squidward got the new wood clarinet from SpongeBob, he starts to say, "I feel like a.......I feel like a ......" a transparent donkey appears over his face and begins to make "hee haw, hee haw" noises, hinting that Squidward feels like a jack***. Oddly, afterward, he said, ".......big jerk!"