The Little King sees his people making Christmas preparations, but he himself is feeling glum. He joins two tramps at a Christmas display window, then invites them into his sedan chair and home to the castle. The three undress and enjoy a bath together. They go downstairs to nail up their stockings, then retire to bed. Santa comes down the chimney and grows a fully decorated tree from a "Xmas Tree Seed". The three race around the castle in the miniature cars and planes left behind by Santa. A big crash brings the festivities to a close.