Eight years after the events of the third film and seven years before the fourth, Christmas is approaching and Scrat [Chris Wedge] eyes a beaver assembling a cache of foods, among them an acorn. He sneaks in and swipes the acorn, along with several other items prepared as decorations. He ties a large stash of acorns to a piece of bark and tries to slip away, but the pile breaks free, rolls away, and leaves him empty-handed.
Manny [Ray Romano] brings the Christmas Rock out of storage, a family heirloom that Ellie [Queen Latifah] delights in because it is meant to help Santa Claus find them to deliver presents. Peaches [Ciara Bravo] slides down a snowy slope in a playful snowball fight with Crash and Eddie, and Manny explains the Rock’s significance. Sid [John Leguizamo] mocks the idea, and Manny refuses to let Sid near the rock. Sid, searching for his own decorations, chooses a tree instead. Crash and Eddie help adorn it with insects, small animals, and fish bones. To crown the tree, Sid places a star-shaped piece of ice on top, which is accidentally flung off like a boomerang and smashes the Christmas Rock. Furious, Manny declares Sid on the Naughty List for ruining the Rock, but Ellie overhears this and Peaches learns with shock that Manny does not believe in Santa. Sid, in tears that he destroyed the Rock and is on the Naughty List, slides downhill as his tears freeze solid.
Scrat finds an acorn half frozen in a pond, steps onto the slick surface, and begins to ice skate. He slides through a log, misplaces the acorn, and clutches a spider instead, prompting a humorous and chaotic chase.
Sid, still bundled in frost, sulks about being on the Naughty List until Peaches calls him to snap out of it. She plans to head to the North Pole with Sid to convince Santa to lift the Naughty List, and Crash and Eddie join them, eager to save Christmas despite their earlier misdeeds.
The foursome follows the Northern Lights toward the North Pole, but a whiteout separates them for a moment. They regroup, led by Sid, whose misdirection nearly leads them off a cliff. A flying reindeer rescues them and introduces himself as Prancer, who offers to guide them. Sid thanks the creature and continues onward, but nearly tumbles again before Peaches catches him and decides to keep the reindeer by their side.
Back in the village, Manny attempts a patch-up job on the Christmas Rock using mud and sticks, but Ellie soon discovers Peaches, Sid, Crash, and Eddie are missing. Diego tracks the group by Sid’s scent and helps lead the search toward the North Pole, where the intent to find Santa intensifies.
Prancer and the group arrive near Santa’s headquarters, where the santourage guards the workshop against visitors. The scene features sugar plums and peppermint bark as a festive backdrop. An avalanche triggered by the chaos disrupts Santa’s operations, toppling decorations and delaying the gift delivery. Angered by the mess, Santa inflates the Naughty List as a formal reminder of rules and reality, and Manny realizes that Santa is real, inspiring the animals to rally and fix the damage.
The crew works together to restore order, and Santa enlists Prancer to fly the sleigh. Prancer calls on his family—Dasher, Dancer, Vixen, Comet, Cupid, Donner, and Blitzen—to help pull the sleigh and restore Christmas Eve magic. By nightfall, Santa departs with the revived fleet, and everyone returns to the Nice List, even Sid.
As a final memento, Scrat glances at his present from Santa—a small nut—but the gift slips away in a gust, and he is humorously knocked around by the reindeer as he circles the Earth once more.
