Continuing on their journey to Olivine City, Ash, Misty and Brock find themselves walking through a large canyon. Misty spots the unstable boulders by the canyon's edges, and soon a large gust of wind causes a rockslide. Luckily, a pack of Arcanine jumps in and rescues the gang. Now safe, Ash thanks the Arcanine's Trainers, Ramona and her younger brother Keegan. After some brief introductions, Ash is amazed because he has never seen an Arcanine close up before. He then checks his Pokédex, which informs him that a Growlithe can only evolve into Arcanine by use of a Fire Stone. Ash tells Keegan how he got ahold of a Fire Stone. Keegan proceeds to show Ash a large collection of Fire Stones, and he explains that they are to be given away at a competition for Fire-type Pokémon to be held later on. Ramona adds that she and her brother operate a courier service using their Arcanine for transport. She then asks where the group are going, and after learning that they are heading towards Olivine City she offers them a lift aboard one of the Arcanine. Ash and his friends agree, and after a dash across some rugged terrain the group takes a break in a forest clearing.
While Misty and Brock enjoy some hot refreshments, Ramona, Keegan and Ash groom the Arcanine's thick furs. Hearing Ash's interest, Keegan suggests that Ash should ride an Arcanine by himself, and Ash decides to give it a go. After a rocky start, Ash gets the hang of riding Arcanine, until he gets thrown off at the end of the lesson. The ever optimistic Ash announces to everybody that all he needs is practice and he will be as good as Keegan is.
There is a sudden noise in the sky. They look up and see a rocket heading straight for them. Everybody scatters and it lands right next to where they were standing. A rubber hand pops out of the rocket and grasps the Fire Stones. They all wonder who would try to steal the Fire Stones. Team Rocket emerge and recite their motto. Ash commands Pikachu to stop Team Rocket from stealing the Fire Stones with Thunderbolt, but Meowth grabs Pikachu with the same rubber hand, preventing Pikachu from using his Electric-type attacks. Ramona then commands one of the Arcanine to free Pikachu, which it succeeds in doing. Ash catches Pikachu and Keegan then commands all of the Arcanine to attack Team Rocket. After missing them, Team Rocket retreats into their rocket and they retrieve a tandem bicycle to make their getaway. Ramona and Keegan pursue the trio on their Arcanine, and they catch up them quickly. Jessie takes evasive action and puts the brakes on the bike. As for the Arcanine, because of their momentum and speed, they cannot stop in time and end up falling into one of Team Rocket's pitfall traps. Jessie and her teammates are pleased with themselves and they continue pedalling away.
Ash's group soon finds Ramona and Keegan in the pitfall trap, and help them out. Brock uses his Golbat's Supersonic to locate Team Rocket. Golbat leads them to a fork in the road, where Team Rocket has split up. Reluctantly, they split up as well to see if they can find which one of the three have the Fire Stones. The first group, consisting of Brock, Misty, and Ramona, see a tree stump with a bag on it which looks like the bag of Fire Stones. They come closer and fall into a hole dug by James, who comes out and taunts them. The second group, consisting of Ash and Keegan, find Jessie escaping on a unicycle trying to outrun them. They follow her through some bushes and end up on a Pokémon battlefield. Jessie, on the other side of the field, tells Ash and Keegan that if they want the Fire Stones back, they have to fight her in a Pokémon battle. Ash is eager to get back the Fire Stones, so he accepts Jessie's challenge. Jessie calls out her Arbok and Ash uses Pikachu. After a short battle, Jessie acknowledges Ash's win and throws the bag in the middle of the battlefield. Ash, Keegan, and Arcanine rush to the middle of the field, only to fall into a pitfall trap dug in advance. At the bottom of the hole, Keegan appears to have sustained a broken arm. While Ash is asking if Keegan is alright, Jessie grabs Pikachu with the same rubber hand as before and places Pikachu in a special cage. By evening, Jessie and James report back to Meowth that their divide and conquer plan succeeded. Meowth is keen to present their new prizes to the boss so they can get the recognition. They soon take off happy that one of their schemes actually worked.
As night approaches, Ash finally gets out of the hole that was dug and suggests to Keegan that they find Team Rocket immediately. In spite of his sore arm, Keegan tells Ash that they better find them in a hurry because the competition that will award the Fire Stones needs them by tomorrow. Ash suggests that he should lead Arcanine instead, and Keegan agrees to the idea. As they are riding, Ash is still trying to learn to ride Arcanine, though Keegan is able to give him instructions to avoid calamity. Keegan tells Ash that he needs to treat Arcanine like they are together as one. Ash recalls that this is how he and Pikachu are, so he concentrates on forming an emotional bond with Arcanine. With his new-found connection with Arcanine, Ash gains the confidence to ride Arcanine to find the stones. Night falls, and they have stopped at a clearing on a foothill.
Arcanine sniffs around trying to find Pikachu's scent, and soon finds it. Meanwhile, in a clearing in the woods, Team Rocket is enjoying a victory meal. James is worried about the amount of money borrowed to pay, but Jessie and Meowth are quick to remind him that once they sell the Fire Stones they will be in line for a promotion. With that, the trio cheers to themselves and dig into their banquet meal.
About this time, Brock and his group make it out of his hole with the help of Onix. On the surface, Misty hears a growling sound, and Brock then orders his Onix to follow it. Soon after, Ash and Keegan gatecrash Team Rocket's celebrations and demand the Fire Stones be returned. Keegan orders his Arcanine use Take Down. However, Jessie pushes Wobbuffet into the battle, and it Counters Arcanine's attack, which gives Team Rocket the chance to escape in their hot air balloon with Pikachu and the Fire Stones. Right about now, Brock and his group join Ash. Ramona tells her Arcanine to use their Fire Spin attacks to bring down Team Rocket. The Arcanine run up Onix like a ramp before setting the Meowth balloon alight. As a result, Ash catches Pikachu and Brock catches the Fire Stones while Team Rocket hits the ground hard. Jessie, still determined to be victorious, sends out Arbok to get even, but Keegan steps in and uses his Arcanine to take care of Arbok with Take Down. Arbok is knocked into Team Rocket, causing them to run away. Keegan points out that Team Rocket are escaping, and Ash is determined to not let them off the hook. He, with Pikachu on his shoulder, chases the trio down on an Arcanine, and a Pikachu Thunderbolt sends Team Rocket blasting off.
Brock is amazed by Ash's handling of the Arcanine, though Misty brushes it off as beginners' luck. As day breaks, Ramona interrupts and mentions to Keegan that they better get the Fire Stones to the competition before it is too late. They make it to the competition grounds and hand the Fire Stones to the director in time. Later, Keegan and Ramona thank Ash and his friends for their help, well aware that they need to be going. Brock offers to stay with Ramona, but Misty is quick to drag him away by the ear. A final wave goodbye, and Ash's group continues their journey.