With Ash earning his third Badge, he and his friends have now stopped on an island known to have larger-than-normal Pidgeot and Rhydon. Pikachu looks at the map and points at a mark, now inspired to look for buried treasure. The group runs into a fruit basket in the middle of the road. Ash goes for it, but Misty stops him, suspecting a trap. She points to a nearby fruit tree as an alternative, and as they go for it, they fall into a trap hole. One of the apples falls onto Ash’s head, and he tries to eat it, finding out it is a fake.
Team Rocket reveals themselves and how they used reverse psychology with the real fruit basket, causing Ash to pin the blame on Misty for her poor judgment, but she dismisses the subject and orders Ash to "find them a way out of there". Jessie and James send out Arbok and Weezing. Ash sends Pikachu out of the hole and attacks with Thunderbolt, but Team Rocket uses special gloves to deflect the attack, and Pikachu is made dizzy by Arbok's Poison Sting and Weezing's Poison Gas, respectively. Meowth then breaks out a pair of blue belts with red spheres implanted into back of them, and hitched to the spheres is strong white rope. Before Pikachu can recover, Meowth locks one of the belts around Pikachu's waist and the other belt around his own waist. The Rockets then escape with their prize just as Ash, Misty, and Tracey climb out of the hole, too late to stop the villains from stealing Pikachu.
Soon afterward, Pikachu stands helplessly amongst the Rockets as they prepare to take him back to their boss. However, their plans are foiled yet again when a giant Pidgeot swoops down and grabs the rope binding Pikachu and Meowth, with Meowth losing his electric deflection gloves in the ascent. As the bird makes off with him and Pikachu, Meowth thinks that Pidgeot is taking them back to its nest, and he asks Pikachu if he can do something about this. Pikachu responds by using Thunderbolt, and though he accidentally shocks Meowth on the first try, he manages to get the Pidgeot on the next try, causing it to release, sending them plummeting. Meowth, saying that there's no way he is going to break Pikachu's fall, attempts to use Pikachu as a cushion for the landing, but Pikachu tries to switch it around. After alternating, Pikachu emerges victorious and Meowth hits the ground first. This is not the end of their troubles, however, as the rope hitched to their belts leaves both Meowth and Pikachu stuck together in the middle of the island; Meowth reveals that Jessie has the key that unlocks the belts. Angered by this revelation, Pikachu shocks Meowth with Thunderbolt.
Back where Team Rocket landed their hot-air balloon, Jessie and James wonder if Meowth can bring Pikachu back, but then say "No way". Ash and his friends corner them with Bulbasaur and Staryu. However, they quickly stop the Trainers and explain about the abduction. Team Rocket takes off in the balloon to search, and the heroes decide to do the same. Tracey sends out Marill to listen for Pidgeot, leading them to Pidgeot’s nest atop a giant rock spire. Ignoring Misty's advice instead of listening to her like before, Ash climbs up to the top, only to discover that the nest is empty. The Pidgeot subsequently returns and dive-bombs Ash, knocking him off the spire and back down to his friends. Apparently undaunted, Ash gets up and continues to search. Both Misty and Tracey know how close Ash and Pikachu are and that Ash will not stop searching.
Meanwhile, Meowth and Pikachu run into a fork in the road and try to go separate ways, but the rope causes them to knock each other over flat on their faces. Meowth goes into a frenzy and angrily declares that they will be going in the direction he wants to go, but Pikachu threatens to shock Meowth again, forcing him to cooperate. After a moment, Meowth knows that Pikachu is in charge and tries to put up a friendly attitude, but Pikachu knows Meowth is deceptive and breaks it with another electric blast.
Meowth and Pikachu are still walking, when suddenly Pikachu smells something. A giant Rhydon comes up from behind and Pikachu tries to run, but Meowth is too scared. Rhydon attacks and Pikachu pulls them away and up the hill, with Rhydon in hot pursuit. Rhydon knocks them around and they make another run. They both fall down a cliff and continue running, but Rhydon is gaining. They get boxed into a canyon, and Pikachu chooses to fight with Thunderbolt, but Rhydon, being a Ground-type, negates the attack. It prepares to rush and Pikachu comes up with a plan. Both Pokémon jump up onto Rhydon and Meowth tickles it to get it to laugh, and Pikachu fires a Thunderbolt into its mouth to knock it out. Both applaud the teamwork. Ash and the others find Pikachu's footprints from the Rhydon struggle. They follow the tracks to the cliff, and Ash jumps down the cliff to continue looking. Jessie and James are still searching from the balloon without much success.
Night falls and both Pikachu and Meowth are hungry from fatigue. They find one apple on a tree and make a run for it. Meowth jumps for it, but Pikachu pulls Meowth down with the rope before using Thunderbolt to bring it down. Pikachu prepares to eat it all, but after seeing Meowth’s sadness decides to split the apple. Meowth realizes how nice Pikachu is and talks about how they could have been friends had things in their lives had gone differently. He thinks Pikachu should abandon Ash and join Team Rocket, believing the two would make a great team. However, Pikachu can't hear him as he has fallen asleep in Meowth's lap. Meowth simply chuckles "I can dream, can't I?" and goes to sleep.
The next day, the two wake up and the giant Pidgeot swoops down after them. They try to run, but the giant Rhydon cuts them off. Both prepare to attack, but Ash and Team Rocket arrive. Ash sends out Snorlax to stop Rhydon while Jessie sends Arbok to stop Pidgeot. Snorlax uses Mega Punch to send Rhydon flying while Arbok uses Wrap and Bite to send Pidgeot scurrying. Meowth runs up to Jessie and James, but is crushed that Team Rocket searched for Meowth only to get to Pikachu. Pikachu runs up to Ash, but James pulls on Meowth in a tug-of-war, Ash demanding them to let go of Pikachu while Meowth screams for James to let go of him. Ash sends Bulbasaur out, knocking Meowth out of James’s grip. Ash sends Pikachu to attack, and James sends out Victreebel, which bites Arbok. Bulbasaur uses Vine Whip to send both of them flying back. Jessie loses the key and Ash grabs it, unlocking both Pikachu and Meowth. Team Rocket runs back to the balloon and prepares a cannon. Misty tries to send out Staryu, but Psyduck comes out instead. The cannon prepares to fire and Misty orders Psyduck to use Confusion. Togepi uses Metronome, which causes the balloon to explode and sends Team Rocket flying. They think Psyduck did it, but Misty suspects Togepi did. Ash and Pikachu hug after being separated. Meanwhile, Team Rocket is battered and hungry. They find an apple, and all three fight for it, with Jessie eating it all. Meowth misses Pikachu's kindness.