Father Ted gets kicked out of a rich parish due to financial irregularities and returns to his old parish which is in a mess. While cleaning up, he uses a lamp shade to mimic a Chinese man, while a Chinese family are watching. The word then spreads around craggy island that father ted is a racist. Ted must now clear his name by holding a multicultural event.
A sheep judging competition comes to Craggy Island and Father Ted puts his air conditioning money on a sure fire winner, until the sheep's condition starts deteriorating. Father Ted decides to nurse the sheep back to health and find out what's wrong with the sheep.
After Father Ted gets the milkman fired for obscene practices, Dougal takes up the job of being milkman. To get revenge, the old milkman has left a little bomb on the milk float. The bomb will set if Dougal accelerates to 5km/h and will go off if he goes below 5km/h.
Father Ted, Dougal and Jack decide to go to the mainland to collect money. While there they drop Mrs Doyle off with a friend and go to some caves. Meanwhile Jack gets new glasses and then stumbles into an AA meeting. A lot of trouble follows for the characters as the mainland can be a dangerous place.
Ted thinks that Father Dick Byrne has rigged the parochial house so that he can learn all of Teds over 75s all priests soccer match secrets. Disaster strikes when Ted's best player dies and second best player, Father Jack drinks a bottle of sleeping syrup and falls asleep. Father Ted must find a way to overcome this incredibly ludicrous situation he is in.
After cheating in the soccer game, Father Ted learns that as punishment he has to kick Bishop Brennan up the backside. Can Father Ted gather the courage to do it?
After Mrs Doyle wins a poetry competition, Eoin Mclove a middle aged woman's dream machine comes to visit Craggy island. When Mrs Doyle accidentally reveals the date that he is coming, the house is then mobbed by middle aged women wanting to see Eoin Mclove.
After Father Ted deals with and saves a young priest who wants to commit suicide, an American priest is impressed by his work. He invites him over to a rich parish in Los Angeles. The rest of them hear about this, but they think that they are going as well. Does Father Ted have the courage to tell them that they are not going to America after all.