A jellyfish insists on following SpongeBob home after a day out at Jellyfish Fields, so SpongeBob decides on letting it spend the night at his home. Squidward warns SpongeBob that jellyfish are wild animals and that they should not be domesticated, but SpongeBob completely ignores him. At home, SpongeBob dances with the jellyfish to loud techno rave music, which annoys Squidward to no end. After 12 hours of this form of nonstop partying, SpongeBob finally decides that it is time to go to bed, but this Jellyfish does not want to stop. SpongeBob eventually forces it to go to bed by tying a leash around it, but during the night, while SpongeBob sleeps, the jellyfish escapes and brings lots of his friends into SpongeBob's house.
The next morning, SpongeBob wakes up to find his living room filled with hundreds of dancing jellyfish. He attempts to make them leave, but to no avail. Squidward, annoyed by this, decides that "two can play at this," and starts loudly playing his clarinet, angering the jellyfish, who start destroying SpongeBob's house. SpongeBob asks Squidward to play his clarinet a little "better," and Squidward responds by intentionally playing even worse and much louder. This prompts the jellyfish to go to his house and sting him before returning to SpongeBob's house. A sting-covered Squidward says to SpongeBob "Everybody's a critic. You won't be hearing from me anymore," and gives him his clarinet. The jellyfish hastily grab it from SpongeBob, break it in half, burn it and dance around it. This further angers SpongeBob, who attempts to remove the stereo system, destroying it in the process, and the angered jellyfish begin stinging and chasing him. SpongeBob and Gary go up to the roof of the house, but the swarm follows them outside and surrounds them. Then Gary drives them away by clicking his eyes together, producing a sound that calms the Jellyfish. SpongeBob tells Gary to keep doing this, and puts him on his head. SpongeBob walks downstairs and out the front door, with the Jellyfish following him. As he leads them back to Jellyfish Fields, more sounds join Gary's clicking, eventually becoming a full-fledged song. In the last scene, the severely stung Squidward is shown getting into a bathtub as the episode ends.
The alternating flashing lights seen during this episode during the disco were very fast and could have been a potential cause for seizures or other similar conditions.
On recent airings of this episode, it skipped the title card, and it begins with the opening credits.
Even though SpongeBob is able to sleep through the blasting music in his own house, Squidward is kept up all night by it.
Even though the jellyfish messed up his home, SpongeBob doesn't get that angry. It's not until they take Squidward's clarinet, snap it in two, set it on fire, and dance around it that he really gets mad, which indicates he really likes Squidward as a friend.
According to the episode "Sailor Mouth," a dolphin noise represents a swear word which means if one would listen to the Jellyfish Jam song without this episode, it could imply bleeped-out swear words subliminally.
In Polish, it was titled Imprezka z meduzami (A Party with Jellyfishes).
In German, it was titled Disco-Quallen (Disco Jellyfish).
In Arabic, it was titled اللخبطة قنديل البحر(Snafu Jellyfish) Snafu is a word that means a confused or chaotic state; a mess.
When Squidward said "Only SpongeBob can have fun with a jellyfish, for 12 hours," the night stand with the lamp moves from the left to the right.
Before SpongeBob said "Gary, you were right. Thanks for not rubbing it in," Gary's mouth moves to "meow" but no words or sounds come out.
When Squidward is playing the clarinet out the window, he is wearing his pajamas. However, after SpongeBob pops his head out of the window and said "I don't think the jellyfish like it," Squidward is wearing his brown shirt. Then after Squidward sets the speakers, he is wearing pajamas again. When Squidward goes to SpongeBob's house, he has his brown shirt on again.
SpongeBob's living room is on the first floor, but when he pops his head out the window, telling Squidward to play his clarinet better, he appears to be on the second floor. However, it was the window placement.
When SpongeBob leaves his room when he wakes up, a portrait can be seen of SpongeBob and Patrick. In the aforementioned portrait, the former is purple and the letter is mint green.
When SpongeBob wakes up to find the Jellyfish gone, Gary is also gone. When he exits his bedroom, Gary is following him.
Throughout the episode, the texture of both SpongeBob's and Squidward's houses has changed.
On the December 12, 2014 airing of this episode, the title card was left out.