In a large tower it shows that Jasmine, the Sultan, and the rest of the gang are all trapped within a cage and Aladdin is forced by a small mamluk-sprite to make a decision of two different doors otherwise Agrabah is doomed. Aladdin picks Door Two, but the sprite says no and drops a globe. However, it shows that Aladdin is no longer in the tower but is now sitting on the throne in his "Prince Ali" outfit as it turns out that Aladdin was merely having a nightmare. It's revealed that everybody (minus Iago) has gone away on vacation and Aladdin has become temporary Sultan until they return. Aladdin reveals to Iago that he isn't ready to be Sultan yet and the responsibility of ruling Agrabah is making him nervous. However, Iago tells him to relax and that being Sultan is easy; all he has to do is sit on the throne and wear his turban.
The guards enter the room, Aladdin becomes worried believing that something has happened but they reveal that a scroll has arrived for him. It turns out to be a letter from Genie telling Aladdin how everyone is doing while also revealing that they know ruling the kingdom is a lot for him to handle but says that everyone has faith that he can rule Agrabah without them. The guards however don't believe that Aladdin can handle the responsibilities and think he will only cause trouble for the kingdom; however, as they leave the throne room they tell him they'll be outside if he needs them. Aladdin is annoyed that the guards don't believe in him and says that he can handle the job. Iago tells Aladdin to calm down and assures him that the kingdom practically runs itself and that as long as he does his job he'll be fine, but starts to wonder what would happen if a monster does attack them causing Aladdin to become worried again.
Meanwhile, high above in the sky it's revealed that Malcho has somehow been able to free himself from his freezing arctic prison and goes to Agrabah to get revenge on Iago. While Iago is in the palace gardens relaxing in the fountain, he looks up to see icicles falling from the sky and calls out to Aladdin for help, causing Aladdin to become worried and call the palace guards. Once they have arrived Iago explains what happened and thinks ice demons are attacking. However when he tries to show them the icicles, they have already melted away. Still, Iago is worried and asks Aladdin to do anything possible to stop them, however Aladdin tells the guards to instead return to their posts. Iago is annoyed that nobody believes him and asks Aladdin to call them back, but Aladdin tells him that he has he entire kingdom to watch over and can't panic everyone over nothing. Iago is now more annoyed that now Aladdin doesn't believe him causing the two to have an argument, which results in Aladdin leaving and for Iago to deal with it on his own.
Meanwhile, Malcho is watching Iago from a nearby bush and is wondering how to exact his revenge. Back at the fountain, Iago finds a scaled feather and after some thought, Iago finally realizes that Malcho has escaped and calls out to Aladdin again. In the throne room after hearing Iago's cries, Aladdin calls out to the guards again and Iago enters the room and reveals that Malcho has escaped and has come to seek revenge over imprisoning in the frozen north. Iago says that it's Aladdin's duty to help those in need, but Razoul and the guards say however that Aladdin's duty is to Agrabah and says that if something or someone is after Iago, then it's his own problem and they kick him out of the palace.
Iago is both furious and terrified and keeps calling out to Aladdin and the guards to let him back inside the palace. Inside Razoul says that Aladdin made the right decision, but after some thought Aladdin decides that they must help Iago. Meanwhile as Iago keeps begging to be let back inside, he suddenly stops and notices a large shadow and sees that Malcho has finally arrived. Terrified Iago lies to Malcho saying he's really a bird called "Phil", however Malcho is not fooled and is about to attack him, but Aladdin quickly saves him and takes Iago inside.
Everyone are trying their best to defeat Malcho and send him back outside, but just as they finally get him out, Malcho takes Iago hostage just before he's pushed out. The guards are finally able close the doors, but Aladdin orders them to be reopened to rescue Iago and they reluctantly do so. As everyone gets out of the palace they see that Malcho is about to devour Iago. But before Iago is eaten, Aladdin use bolas to trap Malcho. However despite being trapped, Malcho is able to escape underground but just before he leaves, Aladdin is able to free Iago from him.
Realizing that Iago has escaped his clutches, Malcho warns them that he'll be back. The guards are now mad as because of letting him escape, Malcho is now a threat to Agrabah and they start to blame Aladdin for this mess. Iago gets everyone's attention and reminds them that Malcho is after him and says that they have two choices: They could either keep him safe in the palace where Malcho won't be able to get him, or they could leave him alone on the streets where Malcho will destroy the entire city just to hunt him down. Now convinced, they decide it's best to keep Iago locked in the palace in order to secure the kingdom's safety.
At the Throne room, the guards board up the space between the marble pillars so Malcho can't get in and take Iago. While Iago himself is safe and sound, sitting on the throne enjoying himself. However, as the guards and Aladdin leave, Iago becomes afraid, but Aladdin reassures Iago that he's completely safe and leaves the throne room. Suddenly the ground starts to shake and Malcho enters the room from underground, Aladdin is able to make it to throne room to protect Iago, but Malcho locks the doors and the guards are not able to get in to help. While the guards get a battering ram to knock the doors open, Aladdin and Iago face Malcho themselves.
When the guards finally get the battering ram and knock the door open, they arrive in the room to see Malcho holding both Iago and Aladdin in his clutches. While Malcho is busy with Aladdin, Razoul sneaks behind him is able to free Iago and ties a battering ram onto Malcho's tail, and take it to the balcony causing Malcho to both release Aladdin and fall out of the palace. Aladdin congratulates Razoul on a job well done, but Iago reminds the both of them that Malcho is getting away. Malcho is able to escape but again tells everyone that he'll be back. Iago tells Aladdin to do something about this, but Razoul and the guards disagree and start to get into an argument over what Aladdin should do. Finally having had enough of watching and listening to the guards and Iago going at each other's throats, Aladdin tells them all to stop arguing with each other and start listening to him for once. He lays down the law and says since he's the sultan for now, he'll make the decisions and doesn't want to hear any backtalk, before asking if anyone has a problem with it. They don't, causing everyone to agree and he finally seems to get everyone's respect. Now having full control over the situation, Aladdin tells them he has an idea.
Later, everyone goes to a volcano and are preparing their new plan to finally defeat Malcho. Iago doesn't exactly like this idea and isn't sure it will work, but Aladdin reassures him as he ties Iago to a post. Razoul alerts the others and Malcho shows up, Aladdin says he is willing to give him Iago in return for leaving Agrabah alone. As Malcho is about to eat Iago. Aladdin tells him to wait saying that Iago could escape when really he secretly unties him and holds the parrot up to Malcho. While Malcho is distracted, Aladdin passes Iago to the guards, who hand him a hammer in return. Aladdin hits the post, the ground shakes, he and the guards run away, and Malcho gets sucked into the lava.
Back at the Throne room, as Aladdin and Iago are finishing repairing the floor, Razoul and the guards alert to them that the everyone is finally back. As Aladdin is reacquainting himself with everyone, the Sultan asks Aladdin how everything went, he and Iago tell him that everything was alright instead of mentioning Malcho; Iago adding in that Aladdin can be his sultan anytime. Meanwhile, Malcho gets out of the lava and decides that he now wants revenge on Aladdin and no longer cares about Iago.
"Aladdin, listen to me! Give up the bird!" - Razoul
"Give me up? Give up your mama! It's your duty to protect the kingdom and I am— " - Iago
"EVERYONE! SHUT UP! I'm through listening to any of you. I'm the Sultan for now, I'll make the decisions. No backtalk. Anyone got a problem with that?" - Aladdin