Discovering Squidward's depression about not finding peace, SpongeBob and Patrick try to make him feel better by building the Enchanted Tiki Island. The noise disturbs Squidward from sleeping and he comes to check out what was going on, soon finding the Enchanted Tiki Island. At first, Squidward thinks that he has become, but then he decides to just go with it, following a musical number sung by him and the talking tiki statues, Squidward has the time of his life and starts dancing with SpongeBob and Patrick. Unfortunately, Patrick accidentally knocks over several tikis, leading to a fire which destroys much of the area. Squidward once again starts crying, however, a boat from Tiki Island was shown to have survived the fire, and Squidward gets an idea about how to make the fun last. Later, Squidward is seen riding the boat like a carnival ride, with SpongeBob and Patrick taking turns being hit by the boat.
The enchanted tiki island has tropical trees, and a river. It is also complete with talking tiki heads, juice bars, and huts. It is first a river ride in a wooden carved canoe, leading to a waterfall, including soap, where Squidward showered under it. After that, the boat goes to a Tiki Bar with smoothies and other delicious drinks. The Tiki Land is made mostly of water pipes and wood, held together by earwax (when it should have been glue).