The special opens with a man named George, who lives alone with his pet cat, finishing up the decorations on his Christmas tree by putting up a paper star. However, when he looks at the result, he finds it disappointing and tries several odd alternatives before looking out the window. He sees the Star of Bethlehem shining in the sky outside and decides that it would make the perfect topper for his Christmas tree.
George gathers several random objects from his basement and manages to construct a working spaceship out of them, but just as he leaves Earth's atmosphere, he gets sucked into a giant black hole, where he finds himself in an interstellar motel called Ralph's Vacancy. There, he meets the owner, a robot named Ralph, who explains that he has been all alone for nine million years and is very happy to meet his first guest. After getting a decent night's rest at the motel, George decides to bring Ralph with him on his quest.
After getting out of the black hole, George and Ralph meet the Space Rangers, a group of robotic law officials who ensure that order is maintained throughout the galaxy. The Rangers tell George and Ralph that they need a permit before they can go star-hunting, and to earn it, they need to collect a lot of space junk. But when George and Ralph are out looking for space junk, they are suddenly captured by a group Space Pirates. After meeting another one of the Pirates' captives, a female astronaut named Barbara (whom George finds himself falling in love with), Ralph suggests they try to lull the Pirates to sleep with Christmas carols, after which they can escape. Unfortunately, it doesn't work, and the Pirates prepare to make the three of them "walk the plank". Fortunately, the Space Rangers arrive and save them, and they give George his permit for star-hunting.
George, Ralph, and Barbara continue the quest, but they suddenly find more trouble in the form of a fuel-stealing spacebike gang called the Bell's Angels, led by Ding Dong Bell. Although Ralph manages to combat their lasers with his fireworks, the Bell's Angels manage to steal the fuel from George's spaceship. However, George managed to build a miniature shuttle for them to use, so they can continue their quest. They manage to retrieve the Star, but their little shuttle runs out of fuel at that very moment. Fortunately, Santa Claus, riding in his sleigh pulled by six robotic reindeer, shows up and gives the trio a lift in the mobile cottage attached to the back of his sleigh.
George is so impatient to get the Star, which he has somehow placed in a cardboard box, on his tree that as soon as Santa drops him and his friends off at his house, he rushes inside to get the job done. But the moment he opens the box, the Star escapes through the chimney and assumes its rightful place in the night sky. George and his friends are initially pretty saddened that they went through this journey for nothing, but George soon realizes that, having gained two new friends, he is indeed better off now than when he started. The special ends with George, along with his girlfriend Barbara and his robot buddy Ralph, staring at his Christmas tree, topped off with the paper star he placed on top at the beginning.