It is a very hot day in Bikini Bottom, and the Krusty Krab is seeing no business. The employees are annoyed being in the restaurant because of how hot it is and the fan stops working. To get some customers, Mr. Krabs moves his business to the middle of the sea at Goo Lagoon, where he, Squidward, and SpongeBob meet up with Patrick and Sandy. Patrick then tries to get on the board on which the grill is, but ends up tipping it vertically into a wave, sending them off to separate places: SpongeBob, Patrick, and Squidward end up on an island with young surfers, Mr. Krabs is stranded in the middle of the Dutchman's Triangle (which he identifies by red waterspouts, raining doughnuts, and still waters), and Sandy ends up on a small island in the middle of nowhere. SpongeBob, Patrick, and Squidward come across the locals, who claim to be junior college dropouts and take them to a hut made of bat droppings (guano), where they learn that the only way back to the mainland is by surfing. SpongeBob, who does not know how to surf, starts panicking.
Meanwhile, the Flying Dutchman accidentally rams into Mr. Krabs on his way home from the grocery store and spills his groceries. As a result, the Dutchman then tries to get money to get more groceries from Mr. Krabs by stealing his cash register (which he now calls Cashy), and a fight brews.
While that's happening, SpongeBob, Patrick, and Squidward receive lessons from the locals, but struggle to focus, until they are told to head downriver to see Jack Kahuna Laguna (aka JKL), who was supposedly last seen upriver. After a while of enjoying the sights, SpongeBob stops to retie his shoes but stumbles upon the cove where JKL was last seen. Patrick and Squidward follow him further and discover JKL, who they watch surf for 2 and a half hours. He later starts a fire and tells them to look into it, claiming that doing so will show them the secrets to surfing, but Squidward refuses, saying it is ridiculous.
Meanwhile, Sandy thrives by building a 5-star hotel, a helicopter, a steam-powered generator, a cappuccino shop, a coconut-milk-powered car, and a control tower, but decides to head back home. Meanwhile, at the Dutchman's Triangle, the Flying Dutchman gets hold of the cash register, but accidentally releases the tray, which hits him and sends him to Davy Jones' Locker, where "Davy Jones" is revealed to be the real-life actor of the same name.
Back with JKL, JKL continues to teach SpongeBob and his friends how to surf, but during the middle of the final lesson, JKL leaves to head towards a temple, and SpongeBob and friends follow. It begins raining as soon as SpongeBob and friends hit the top, and JKL tells them that every 1,000 years or so, the planets align in such a way that the perfect waveforms, known as "The Big One," and that this time has come, and SpongeBob and friends must ride it back home, or else be trapped on the island forever. SpongeBob and his friends are also told by JKL that the Big One requires a sacrifice to stay "alive" for the whole trip and that one of them will not return. SpongeBob and friends head off to the Big One, but immediately, it eats up Patrick and Squidward's boards. SpongeBob allows them onto his board, then Mr. Krabs shows up and gets swallowed by the Big One, but JKL shows up and rescues him. Mr. Krabs then accidentally drops Cashy into the wave. JKL jumps into the wave to recover it, and as a result gets absorbed by the Big One, sacrificing himself allowing SpongeBob and the others to get home safely. SpongeBob then surfs them back home while playing a tribute song to JKL's sacrifice.
Meanwhile, Sandy crashes into Goo Lagoon in her helicopter, where the beach visitors mistake her for an alien. SpongeBob, Patrick, Squidward, and Mr. Krabs wash up a few seconds later, soon followed by JKL who somehow survived the Big One and they welcome them back home with a luau. JKL gives Mr. Krabs Cashy, and the episode ends with them dancing at the beach.
This is the only episode in the series to include SpongeBob's full name in the title.
In countries outside the United States (such as New Zealand, Greece and UK), this episode is called "SpongeBob SquarePants and the Big Wave."
In some countries, including Latvia, Ukraine, Australia, and Germany, they use an alternate title card that reads "The Secret of Kahuna Laguna."
This episode is also known as "SpongeBob vs. the Big One" which is used in Russia.
The German title is "Die Welle Zuruck" which means "The Wave Back."
The Dutch title of this episode is "Het geheim van Kahuna Laguna," which means "The secret of Kahuna Laguna."
The Japanese title for this episode is "スポンジ・ボブとビーーッグウェ～ブ" which means "SpongeBob and (the) Big Wave."
This episode has the longest opening credits right after the title card due to all the special guest stars.
When SpongeBob's shoes are melted off, Mr. Krabs said: "Let's go to the beach." When SpongeBob ripped his clothes to swimming clothes, he had flippers on, but he was barefoot before he ripped them off.
Sandy builds a 5-star hotel, a steam powered generator, a car and a helicopter using the natural resources on the island she was stranded on.
There is another fish (Dennis Rechid) in the control tower on Sandy's island. There was another fish with the same appearance at Goo Lagoon when Sandy landed with her helicopter. It's possible that the fish from the control tower was stuck there not long before, and somehow found his own way back.
When Sandy's Helicopter hits the Flying Dutchman, his hat falls, and then his hat suddenly reappears.
Sandy managed to survive and thrive on a nearby island. This is similar to how she can also survive in "To Save a Squirrel," where she also used her bare hands to survive.
Both Davy Jones and his locker appear in this episode.
The music for the end credits of this episode is the Monkees' "Daydream Believer."
SpongeBob says he didn't know how to surf in this episode, but he was seen surfing in "Ripped Pants" and "Pranks a Lot." This episode possibly takes place before these two episodes but he does know how to tie his shoes so it must take place after "Your Shoe's Untied."
In Indonesia, Twitch says "That's right. Kemosabe Island. Although, we sometimes refer to it as an... island." That means either he knows the name of the island, or Indonesia didn't have a translation for the word kemosabe.