The episode starts out with SpongeBob hunting jellyfish in Jellyfish Fields. Suddenly, he spots a young female squirrel wrestling with a giant clam. He takes out his field guide book, and identifies her as "Land Squirrel." SpongeBob thinks that she is in trouble, and goes to wrestle the clam himself. The squirrel manages to escape the clam, but SpongeBob ends up inside it. The squirrel then rescues SpongeBob, and throws the clam out of the area. SpongeBob introduces himself, and the squirrel says that her name is Sandy Cheeks.
SpongeBob inquires about the helmet she wears, and Sandy tells him that it's her air helmet. SpongeBob doesn't know what air is, but he doesn't tell her this, instead he says that he loves air. Sandy, surprised that SpongeBob is fond of air, invites him to her treedome for "Texas tea and cookies."
SpongeBob quickly runs over to his best friend, Patrick Star and tells him everything that happened. Patrick tells him that 'putting on airs' is fancy talk. He then tells SpongeBob if he wants to be fancy, to hold his pinky finger high above him.
When SpongeBob arrives at Sandy's treedome, Sandy is in a purple bikini, since she does not need her air helmet inside. SpongeBob goes inside, and notices that the water level drops to almost nothing. He panics, and tells Sandy that there is no water. She tells him that, it's just air. SpongeBob says that there isn't any problem and tries hard to breathe. He doesn't realize that sea creatures need water to survive.
Sandy gives him a tour of her treedome, showing him that she has an oak tree, a bird bath, and other things. During this, SpongeBob quickly sneaks over to the bird bath, which is filled with water, and soaks up the water. The bird then angrily kicks him out.
SpongeBob gives Sandy some flowers. Sandy is very pleased and she decides to get a vase for them. Sandy asks SpongeBob if he needs anything, and he replied "Water would be nice," though Sandy does not reply to that, and simply leaves to gets the vase.
Meanwhile, Patrick, watching from outside the treedome, tells SpongeBob to keep his pinky finger up. Sandy comes back and puts the flowers in a vase, filled with ice cold water, on the picnic table. SpongeBob tries to resist drinking the water. Sandy asks him to tell her about himself, and remarks that being a "sea critter" must be fascinating. However, the oven dings and Sandy goes to get the tea and cookies.
SpongeBob eventually gives in (After a mental battle of assuring himself that he doesn't need the water, and finally screamed "I NEED IT!"), drinks it, and runs for the door, declaring that he is a quitter. Patrick, thinking he is being shy around Sandy, quickly enters the treedome and tries to convince him to stay. After a moment, Patrick also realizes that there is no water. The two struggle to get out of the treedome, but are unsuccessful.
When Sandy comes back, she shrieks as she spots both Patrick and SpongeBob dried up on the grass. She helps them by giving them water-filled helmets and mentions that if they needed water, they should have asked. In the end, Sandy proposes a toast to new friends, and they drink their tea. SpongeBob and Patrick drink by gulping the tea-filled water in their new helmets (due to being unable to drink the tea from their glasses while wearing their water helmets) with their pinky fingers pointing up.
She also never seems surprised that Patrick was there. As if she knew he was there. This may be explained in a reference inside Battle for Bikini Bottom, Where when you're in Sandy's Treedome, You can find Patrick looking through the glass.
The map Sandy gave SpongeBob was very inaccurate. As it just said You Are Here. Not saying where 'Here' is.
When Patrick is telling SpongeBob how to be fancy, he lifts his right hand pinky finger up. From the front view the pinky is shown on the left side. From the back view, it is shown on the left side instead of the right, and looks like SpongeBob is holding up one of his middle fingers instead of his pinky.
When Sandy is pouring water in Patrick and Spongebob's water helmets, while Sandy is pouring water in Patrick's helmet, SpongeBob looks relieved but he didn't get any water yet, so he should be struggling to breathe like he was before in the episode.