Felix makes his way into the sewers. Suddenly, he notices a group of giant rats behind him, who throw him into sewage. Felix hitches a ride on a skull and uses his tail as a row until he is grabbed by a slimy yellow creature with green eyes and a long nose. A slimy yellow creature with black eyes, a brown cape, and a crown who calls himself the Sludge King greets Felix and introduces the cat to his den. He commands his minions to throw Felix into prison.
Felix finds Rosco trapped in a bird cage. The Sludge King demands more sewer grog from his minions. He sticks his arm into all three canisters and gulps it down, then tosses them aside. He tells Felix, in song, that he wants to eat "little pets like you" and Rosco. Felix has a flashback to the time he saw the computer animation at the animation studio. He grabs a remote from a live-action family viewing the cartoon. The father figures that it is one of those "interactive deals." Before Rosco can be eaten by the Sludge King, Felix rewinds the cartoon to the point where he viewed the computer animation. Once he finds out how the gag turns out, he fast-forwards back to the sewers. Felix calls "More grog for the king!" The Sludge King drinks two canisters of grog. Felix widens the bars in his cell, allowing him to escape. When the Sludge King notices that Felix is out of his cage, the cat pulls a portable outhouse labeled "Royal Flush" out of his Magic Bag. The Sludge King initially says that he does not need to go, but Felix mentions that it has a sink with warm running water, which convinces the Sludge King to use it. Felix turns his Magic Bag into a jetski and he and Rosco ski into the sewers.
The two jetski into the sewers with the Sludge King's minions behind him. The Sludge King tells his minions to pursue the two. Felix grabs onto a pipe with Rosco so that they are out of the minions' sight. Felix opens a manhole and Rosco climbs out of the sewers and reunites with Candy Kitty. Felix also retrieves his Magic Bag from the sewers by whistling for it. Candy considers Felix a hero and gives him a kiss. Suddenly, a honking from a car is heard. The computer animator calls Candy Kitty over to his car and the two drive off. Rosco tells Felix that he knows how it feels to suffer a loss, but he says that "I found a replacement, and so will you." He hands Felix his jelly donut. Felix simply laughs.