In a cozy home theater, Timon, Nathan Lane and Pumbaa watch the opening act of the first film until Timon fast-forwards to the Hakuna Matata scene where they appear. However, Pumbaa rewinds the film to the beginning so as not to confuse the audience. Timon decides to tell the story of how he and Pumbaa met and learned Hakuna Matata, which Pumbaa agrees to. They rewind the film to before the beginning as their own story begins.
The meerkat Timon lives in his colony on the outskirts of the Pride Lands with his Ma, Julie Kavner and Uncle Max, Jerry Stiller, but is an outcast to the meerkats. One day, while assigned as a lookout for hyenas, his daydreams of a better life lead to a hyena attack, prompting Timon to leave the colony after deciding that he will never fit in. During his journey, he meets Rafiki, Robert Guillaume the mandrill, who teaches him the philosophy of Hakuna Matata and advises him to “look beyond what you see.” Timon takes this advice literally, and, he observes Pride Rock in the distance, setting out in that direction. Later, Timon encounters the warthog Pumbaa, Ernie Sabella.
The pair arrive at Pride Rock during the presentation of Simba to the animals of the Pride Lands, and as they make their way through the crowd, Pumbaa passes gas from his agoraphobia, causing the nearby animals to faint and prompting animals further away to bow to Simba. Attempting to find their perfect home, the pair witness the dramatic ending of I Just Can't Wait to Be King, the chase through the Elephant Graveyard, the hyena march scene of Be Prepared, and the wildebeest stampede that kills Mufasa. Escaping the stampede, the pair are sent down a river and over a waterfall. Exhausted, Timon suggests giving up and going home. Pumbaa admits that he does not have a home, and the pair realize they are each other’s only friends. They discover that the river has deposited them in a lush green jungle that Pumbaa was trying to tell Timon about. The pair settle there, embracing Hakuna Matata as their philosophy. Meanwhile, Timon's mother and Uncle Max leave the colony in search of Timon after Ma gets mad at Rafiki for apparently leading Timon on a wild goose chase.
Timon and Pumbaa later rescue Simba and raise him under their philosophy. Years later, Simba's childhood friend Nala appears and reunites with him. Believing the trio's friendship to be in jeopardy, Timon and Pumbaa attempt to sabotage their burgeoning romance, and believe they have succeeded when they see the two get into an argument about why Simba refuses to return to Pride Rock. The next day, Nala explains that Simba has returned home to challenge Scar and reclaim his rightful place as king. Pumbaa follows him, but Timon, angry that Simba has seemingly discarded their philosophy, refuses to help. Timon soon becomes lonely without his friends' company, and Rafiki indirectly helps him realize that his true Hakuna Matata is with the ones he loves. Timon catches up and reconciles with Pumbaa in the desert.
After helping to distract the hyenas with a hula dance in the Pride Lands, Timon and Pumbaa run into Ma and Uncle Max. Seeing the hyenas advancing on Simba, Timon proposes that they all help Simba by getting rid of the hyenas for good. Ma and Uncle Max construct a series of tunnels beneath the hyenas while Timon and Pumbaa stall for time. Uncle Max collapses the tunnels, breaking the ground under the hyenas. Timon breaks the final support beam himself and the hyenas are ejected through the tunnels, which Scar then falls into. Simba accepts his place as the rightful king of the Pride Lands, thanking Timon and Pumbaa for their help. Timon invites Ma, Uncle Max, and the rest of the meerkat colony to live in the jungle with him and Pumbaa to complete his Hakuna Matata; the colony praise him as their hero.
As the film ends Pumbaa wants to watch it again, but Timon declines. Ma comes in, wanting to watch the film and rewinds the movie. They are soon joined by Uncle Max, Simba, Rafiki, and various Disney characters such as Mickey Mouse, Snow White, Stitch, and many more. Pumbaa gives Timon the remote and plays the movie.
