Abu and Iago get caught stealing by the thieves at the Skull and Dagger and run away from them. Aladdin finds the two and they go shopping for a present for Jasmine, which is a locket. Abu finds a box which Aladdin believes Jasmine will like. The mystic tells him that the box is not for sale and she gives him a gift. Iago suggests to Abu that he steals the box so the two can get what they want from Jasmine.
Jasmine opens Aladdin's gift and finds a smelly stuffed yak, which she doesn't seem to like. Iago and Abu give her the box from the store. When Jasmine is about to open the box, it escapes and magically gives Aladdin a locket, which Jasmine likes and wears it. When Abu and Iago open the box, a wallaby/gorilla/rabbit-like creature, who Iago later names Squirt, gets out and hide. It magically gives Abu a banana parfait and Iago caviar and a manicure. After seeing Squirt magically give Rajah a steak, Iago realizes that the creature grants people's wishes every time he gets scared. This gives him and Abu an idea.
While Jasmine is sleeping, Abu and Iago steal Squirt from her and scare him at Aladdin's hovel. Abu gets his wish granted, but Iago is unable to scare Squirt. When Genie shows up, Iago hides the creature but later sees him jumping off the hovel window. So he and Abu go find him. Squirt finds himself at the Skull and Dagger.
Amin Damoola sees Squirt granting the other thieves wishes and wants to keep him to get what he wants from him. Iago shows up to rescue Squirt, but finds a green dragon-like monster about to eat him. Squirt magically gives the dragon meat, but Amin kicks the meat away and the monster chases and attacks him. After defeating Amin, Abu and the others show up.
The mystic wants to get Squirt back, but Jasmine wants to keep him. Iago suggests that Squirt should decide for himself what he wants to do. When Iago shows Squirt his reflection, the creature scares himself away and ends up in a tropical area with others of his kind.