Lavender Town. It's very foggy, and Brock suggests that they all hold hands so that they don't lose each other. Ash and Misty take hands, and Brock accidentally grabs Pikachu's tail, getting a shock. Misty screams, then tells him not to yell like that. Ash tells Misty in a weird voice that she scared him with her scream, and turns around to show a skull face. Brock, Misty, and Pikachu scream and Ash laughs, taking off the mask. He tells them that they need to be prepared for surprises like that in the tower, but the Misty and Brock yell at him and Pikachu gives him a tremendous shock.
The fog clears, and Ash and his friends see Lavender Town, with the Pokémon Tower on the other side. They make their way towards it, and it is dark once they get there. Brock and Misty tell Ash to go on inside, but he hesitates, saying that they promised to help him capture a Ghost Pokémon. Brock and Misty don't remember this, but Ash tells them that he's not afraid. He asks Pikachu for support, but he's getting ready for a nap. Ash agrees that this may not be a bad idea, and tells Misty and Brock to wake him up in the morning. Misty hits a gong, which springs them back out of their sleeping bags. Up in the tower, Team Rocket laughs at them. Jessie tells James to get started and he runs towards the door, only to fall through the floor. Jessie and Meowth peer down, and Meowth notices a Gastly behind Jessie. He tells her to turn around, but Gastly disappears before she turns. Gastly materializes around Jessie's face, but she still doesn't notice. Meowth scratches at the Ghost Pokémon, but only manages to get Jessie's face. She gets extremely angry, and whacks Meowth into the hole with a huge metal mallet. She looks into a mirror, and notices the Gastly. She faints, and falls into the hole, on top of James and Meowth. The floor breaks again, and they plummet into darkness, screaming all the way.
Back outside, Ash and his friends hear Team Rocket's yells, and get worried. Ash notes how the voices sound familiar, and they all go inside. The door shuts behind them, and Ash sends out Charmander for light. Misty suggests that they return when it gets light, but Ash reminds her that Ghosts don't come out during the day. Brock finds a candle and Charmander lights it, frying Brock as well. They step around the hole in the floor, and hear strange voices coming from somewhere. The screen goes to a Haunter and Gengar watching a comedy on television. Gastly appears, and they all laugh some more.
Brock approaches a door and suggests that they see what's inside. Ash opens it, and Brock calls for any Ghost Pokémon to come out. Ash says that her wants to catch them, and Misty scolds him, saying that they won't come out if they know this. The lights turn on, and they see a table covered with an elegant banquet. Ash notices a cord with a "Pull Me" sign attached to it. He complies, and a ball overhead burst open with confetti and streamers, as well as a banner welcoming them. Suddenly, all the plates and food starts to float through the air. A chair scoops up Brock, and Pikachu and Charmander are scooped up by two plates. Misty and Ash run from the room, and Brock, Pikachu, and Charmander jump down and follow. As soon as they leave, the plates and furniture return to their places. Gengar, Gastly, and Haunter appear, laughing.
Back outside, Misty and Brock say that they're not going back in the tower. Ash pleads with them, and turns to Pikachu and Charmander for backup. Charmander burns the three, and Ash yells at him and Pikachu, calling them cowards. He tells them that they'll never beat Sabrina if they're like this, and Pikachu remembers the beating that he got. Pikachu and Charmander agree to go with him, and they go back in, with Misty and Brock waiting outside. Ash approaches the hole, and hears sounds coming from it. It's Team Rocket, but he doesn't know it. He has Pikachu shock them, and Charmander burn them. He throws a Pokéball down, and it hits Jessie in the face. Meowth points out the fact that Jessie's hair is on fire, and she runs around screaming. She faints and it goes out. Ash is disappointed to see that the fireball was gone, and Pikachu is scared by a Haunter. Ash turns to look, but he disappears. Ash turns around, and stares at Haunter. Haunter makes a face, which scares all three of them. Ash whips out Dexter, but it isn't any help. He tells Charmander to burn Haunter, but Haunter has disappeared again. He tapes Ash on the shoulder, frightening him once again. He has Charmander use Leer, but he ends up getting paralyzed by Haunter's lick. Ash retreats him, and Gengar rises from the floor, frightening Ash again. He checks his Pokédex, but it still isn't any help. He looks up, and sees the two Ghost Pokémon performing some sort of act. He tells them that they are not very funny, and they sink down into the ground, upset. Ash lunges at them, but falls to the ground. The impact causes the chandelier above them to come crashing down upon them. Pikachu does a shock, which lights up the bulbs. Gengar, Haunter, and Gastly have reappears, and applaud.
Suddenly, they realize that Ash and Pikachu aren't moving, and Haunter pulls out their spirits. Ash tells Haunter that he doesn't want to be a ghost, but he grabs him and Pikachu and brings them out of the roof and above the tower. Ash notices Misty and Brock waiting for him, and he decides to have a little fun. Misty tells Brock that she thinks they should go in and check on Ash, and Ash asks her if she really is worried about her. She turns, but doesn't see anything. Ash then lifts Misty into the air, then drops her into Brock's arms. Misty recognizes his voice, and she and Brock run inside the tower. Ash and Pikachu fly around with the Ghost Pokémon, and they return to the tower, arriving in some sort of play room. The Pokémon tell Ash and Pikachu that they only wanted someone to play with and to have fun with. Ash sadly says, however, that he can't stay, as he has to fulfill his dreams. The Pokémon are disappointed, and they all go back to where Ash and Pikachu's bodies are.
Upon arrival, Ash sees how worried Misty and Brock are. They reenter their bodies, and wake up. Misty is so happy that she's speechless and blushes a little. Brock is glad as well. They leave Pokémon Tower the next day, and Misty asks him about the Ghost Pokémon. Ash says that he can't catch one, and Brock asks him how he plans on fighting Sabrina. Ash suggests using his sense of humor, and Pikachu points behind them. They all turn, and see Haunter floating there. He makes a face at Misty and Brock, and they run off ahead of Ash. Ash just looks at Haunter and laughs. Apparently, Haunter wants to come with them. Back inside, Gengar and Gastly have some fun with Team Rocket on the Merry-go-round.