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The story opens in "Europe, a long time ago". Nicholas Claus, nicknamed "Santa" by his wife Gretchen, is a toymaker who wishes he could give a toy to every child in the world. It's explained that Nicholas grew up in the Angel's Island Orphanage, where he taught himself to make toys for the other children. However, Nicholas is now in debt because he gives away more toys than he sells. The Clauses are subsequently evicted by their greedy landlord, Mr. Minch.
Now penniless, Nicholas and Gretchen decide to take their remaining toys to the children at the Angel's Island Orphanage. However, their ship is caught up in a storm and they are miraculously transported to the North Pole. There they meet the elves, including wizardly elf Nostros, his son Clement, and the know-it-all elf girl Aurora. When Nicholas saves Clement's life, Nostros is forced to grant him a wish. Nicholas wishes that he could deliver toys to all the children in the world on Christmas. Nostros declares that this is impossible and trying to fulfill it will doom the elves by destroying their magic. However, the wish can't be taken back because it is now "etched among the stars".
Nicholas and Gretchen manage to recruit almost all the elves to help them. Soon they have built a toy factory and gotten to work. Nostros watches form afar, scoffing at their attempt to do the impossible and forbidding Clement from involving himself. Clement sneaks out to help anyway. On the big day, Aurora realizes Nicholas will have to be accompanied by a magical expert on his trip. She goes to Nostros, but he refuses, of course. After thinking about it for awhile, he changes his mind and goes to the toy factory to help Nicholas.
As their voyage around the world ends, Nicholas insists they make a stop at the Angel's Island Orphanage. He gives a young boy a knife so that he may whittle toys for the others as Nicholas once did. Once they return to the North Pole, Nostros and the other elves vote to bestow "honorary elfhood" upon the Clauses, making them immortal. Nicholas declares that they shall do this again every year forever and the elves cheer.
- "To Give Every Child in the World a Toy" (performed by Jim Cummings)
- "We're Gonna Pull It Off" (performed by Jim Cummings, Miko Hughes, Kathryn Zaremba and Tim Curry)
- "Clement's Song" (performed by Jim Cummings and Miko Hughes)
- "Santa's Ride" (performed by Jim Cummings, Miko Hughes, and Kathryn Zaremba)
- Betty White would provide the voice of Mrs. Claus again in Operation: Secret Santa.
|Ed Asner||Nicholas "Santa" Claus (speaking)|
|Jim Cummings|| Nicholas "Santa" Claus (singing)|
|Betty White||Gretchen Claus|