Elmo and his beloved blue blanket are inseparable. When Oscar carelessly tosses the fuzzy blanket into his trash can, Elmo dives in after it. He is suddenly plunged into Grouchland - the land of Grouches, stinky garbage and the greedy Huxley who hasn't learned how to share.

Charlie Harper is a bachelor in paradise, complete with Malibu beach house, overpaid job and a very active dating life. Then his uptight brother Alan, in the throes of a divorce, moves in, bringing his 10-year-old son Jake with him. Together they start a new family of two adults, one kid, and no grown-ups.