The episode begins with Patrick putting the slide projector onto a table, leaping onto it, shaping his head into a ten-gallon hat, then riding the projector like a horse. SpongeBob reminds him that he has a slideshow to give, but Patrick destroys the projector in the process. Instead, Patrick makes a shadow puppet show with a lamp, and the show begins. SpongeBob goes to Patrick's house and knocks on the rock. Inside, Patrick is heard moaning and complaining. When the rock finally opens, Patrick's hand is seen holding a key. When SpongeBob enters, Patrick is seen on the floor, still holding the key. SpongeBob asks what's wrong, and Patrick explains that all he's been doing is waking up, eating, and sleeping... and that he needs a break. SpongeBob suggests a vacation, and Patrick's spirits are lifted. When they go to the travel agency, Patrick is given options, but when it is revealed that he cannot afford any of these trips, he and SpongeBob are thrown out. SpongeBob suggests Patrick to go on a "staycation," a vacation at home. Patrick goes for it.
When he arrives home, he sees his living room has been redesigned as a hotel's entrance, and SpongeBob (calling himself "Todd") is the receptionist. "Todd" gives Patrick his key, and shows him his room. Patrick does not like the way the room is designed, and asks SpongeBob to redesign it. All the furniture is now stacked into one large pile, and Patrick, still not satisfied, tells SpongeBob it's probably the walls. The furniture collapses in a heap of sand. Later, there is a tub of water, which SpongeBob calls it "the pool." Patrick is initially excited, but asks where the diving board is. SpongeBob makes one out of a stool and a plank of wood. When Patrick dives off of it, he hits his head on the side of the tub and falls in. When Patrick is drowning, SpongeBob dresses up as a lifeguard and pulls him out. When Patrick gets hungry, SpongeBob dresses like a French chef and prepares a Krabby Patty on a grill. Just then, Mr. Krabs comes along, requesting payment and a tip. Patrick demands a show to go with his meal, so SpongeBob dances on the table. Patrick dismisses it as "boring." SpongeBob then puts his spatula on his head, and makes a pineapple appear. Patrick dismisses it as "lame." SpongeBob launches the pineapple into the air, where it's sliced in an overhead airplane's turbines. When it lands on a plate, Patrick tells SpongeBob "You are smoking." He means it literally: the Krabby Patty is burning, and a large cloud of black smoke fills the air.
Patrick walks out of the smoke like he's opening a door, still hungry. He catches a delicious aroma coming from Squidward's home, which turns out to be soup. Squidward puts a bowl on his table, but turns around to get a napkin. When he returns to the table, Patrick is eating his soup. Meanwhile, SpongeBob emerges from the cloud of smoke, presenting a burnt Krabby Patty which soon turns into dust and blows away in the wind. Patrick is nowhere to be found, but he hears Squidward yelling. Patrick seems to think Squidward's house is a hotel, and even plans to go to the spa and get a massage. Squidward angrily explains to him that there is no spa and his house is not a hotel, but SpongeBob gives Patrick the massage he wanted. Patrick suggests Squidward to get one as well. Though Squidward is reluctant at first, his shoulder snaps. Squidward then pushes Patrick off the table and asks SpongeBob to give him a massage. After fulfilling Squidward's request, SpongeBob is exhausted and returns home. He goes to bed, but Patrick is in there in bed with him, apparently convinced that SpongeBob's house is also a hotel. Patrick then goes to sleep as a confused and tired SpongeBob looks on.
The scene changes to Mr. Krabs gargling with mouthwash in the bathroom of his house. When he goes to his bedroom, SpongeBob is sleeping in his hammock. Mr. Krabs wakes him up and asks SpongeBob if he's had a nightmare, and if Patrick is in his bed, and SpongeBob says no to the former and yes to the latter. Understanding, Mr. Krabs bids SpongeBob a good night as the episode ends.
When SpongeBob is at the front desk, his hairstyle is the same as his cousin Stanley.
SpongeBob wears the same hotel employee uniform from "Krusty Towers" in this episode, meaning this episode takes place after that episode.
Running Gag: SpongeBob dressing up in different outfits to disguise himself as many different people.
When Patrick made SpongeBob change the room style, it is similar to what Squidward does in "Krusty Towers" when he made SpongeBob and Mr. Krabs change his room until it was back the way it was originally. The same thing occurs here.
At the beginning of the episode, Patrick says, "I was lying around my house, not even planning to have a vacation when I heard a knock at my door," which is similar to the quote "I was working late one night. The "loose bulb" or "Flash Flash" on the neon sign outside my window, is about to drive me crazy when there was a knock at my door." from the Between the Lions segment, Sam Spud.
When Patrick turned his lampshade, the pole holding the light up should have created a shadow in Patrick's shadow puppet show, but it did not.
When SpongeBob put Patrick's seat down, his foot was hurt and flat, but after he put Patrick's bib on, his foot was back to normal.
When SpongeBob performs his magical appearing pineapple act, he sticks his spatula in one of his pores. In the next scene, where Patrick comments on the performance, it is gone. In the next scene, the spatula has appeared once again.
When SpongeBob gets out of the burned Krabby Patty, his chef suit had no sleeves even though in the scene before that one, it had sleeves.