Lilo is teaching Stitch about fitting in on Earth by being obsessed with appearance and taking him to a spa. While there, Stitch attempts to eat mud from a mud bath, but he spits it out on Lilo because it tastes terrible. Immediately a mud fight breaks out in the spa and the store owner scolds them. They are told to clean up the mud and leave, but as soon as they exit, they hear the screams of a man nearby yelling, "My hair!" and pointing at one of Stitch's cousins.
Lilo and Stitch chase the alien, who is going on a hair-eating rampage and giving everyone bad haircuts. Stitch is able to capture the experiment in a hatbox outside of the Birds of Paradise Hotel. Lilo decides to name the alien. Stitch believes she should call her Hairy, but Lilo tells him that her name will be Clip. Gantu is watching nearby and angrily exclaims, "Blitznak!" when he loses his chance to nab the experiment. Hämsterviel scolds Gantu for failing and tells him to get the alien.
Jumba is not happy to see Experiment 177 because she previously ate his hair, which was previously abundant with follicles but is now only three hairs. He says that when creating the experiment, he had in mind for it to eat Uburnium, a rare space fuel. He made a mistake, however, because in one alien language Uburnium and hair were the same word. When 177 emerged, she quickly devoured Jumba's hair. Pleakley overhears this story and tells Jumba that to grow hair he should relax. Jumba desires to destroy Clip, but Lilo wants to find her one true home.
The next day, she takes Clip to the hair salon, which has a hair problem, but before she can deliver the alien, she sees Mertle Edmonds and Elena, Teresa, and Yuki. Mertle insults Lilo's hairstyle and gives her shampoo "for taming wild, unruly hair". Lilo is angry and decides that Mertle should be punished.
Stitch and Lilo stealthily sneak into Mertle's house. Using his infrared vision to see through the walls, Stitch says that the house is all clear and the two sneak in. Upon climbing in through the window, they leave Clip under Mertle's pillow, but before they can leave, Mrs. Edmonds comes in. She is confused as to why Lilo and Stitch are there, and the little girl says it was to drop off an early birthday present for Mertle.
That night, Lilo creates a story of what she believes will happen to Mertle's red hair after it is eaten by Clip. However, Clip instead eats the yarn hair of one of Mertle's dolls, which she then spits out as it tastes disgusting to her. Gantu suddenly opens the window and scares Clip. Investigating the sound of the noises, Mrs. Edmonds opens the door and her head is attacked by Experiment 177, leaving her bald. The alien is able to get away, but gets onto a bus and presumably eats more hair.
The next morning, Lilo rushes to hula class to see Mertle without hair, but is disappointed when she sees that nothing is different about Mertle. The bully explains she had a sleepover last night and how her mom is now bald because her hair was scared off. By the story, Lilo is able to piece together that Clip was snatched by Gantu.
When Lilo and Stitch return home, they see Jumba and Pleakley attempting to find a perfect wig for Jumba. He turns down a rainbow afro, so Pleakley begins massaging Jumba's scalp with his feet. Jumba promises to help catch Experiment 177. They burst into the Edmonds' home and scare Mertle's mom. As she screams, Jumba blasts a net onto her.
They sort out the misunderstanding calmly, and Mrs. Edmonds tells Lilo that she is actually happy with the haircut. She says that a haircut doesn't make a person, but rather the person makes the haircut what it is. Jumba is unhappy with his baldness until Mertle's mom compliments his head shape. Because he becomes less stressed about his poor situation, his hair is able to freely grow and bursts forth from his scalp, much to his excitement.
As they are pursuing Clip, Jumba decides to perform maintenance on his new hair. Soon a hairless squirrel and a scared Gantu rush by, running from a humongous hairball. While trying to save Lilo and Jumba from Clip's hair appetite, Stitch is run over by 177 and his tail is shaven. Gantu runs from the alien and falls from a cliff into a hula demonstration. He dances skillfully for the enjoyment of onlookers.
Lilo vows never to unleash a hair-eating monster on an enemy again. Jumba begins getting split ends due to the stress, so Lilo offers him the shampoo for wild, unruly hair. She then realizes that this is what she needs to tame Clip. They discover that the salon is where Clip will be terrorizing. Using the shampoo, Stitch douses Experiment 177, causing her to shrink. Now that Clip is calmed down, she gives a surfer a haircut, which he says is "the real me".
Giving people haircuts at the spa and salon is Clip's one true place. Jumba even gives up his afro because he realizes that having only three hairs is the real him. Lilo apologizes to the owner of the salon who offers her a free haircut, but Lilo says she is happy with her hair just the way it is.
While Gantu is still hula dancing and apparently enjoying himself, he receives a call from Dr. Hämsterviel. However, he ignores it by tossing his communicator away and keeps dancing.
- Moral: It doesn't matter what you look like; it's who you are that counts.
- In the show's intro, which uses footage from this episode where Lilo and Stitch capture Clip behind the Birds of Paradise Hotel sign, Lilo's green muumuu that she wears in this episode and throughout most of Season 1 is changed to appear as her more familiar red muumuu.
- Stitch initially suggested that Lilo name 177 "Hairy", which is coincidentally the name of Experiment 333.
- It is revealed that Jumba used to have a full afro prior to Clip's creation.