At the North Pole, as Santa Claus is preparing for his Christmas Eve flight, a cargo plane is flying the Tasmanian Devil overhead. Taz escapes from his confinement and ends up parachuting out and landing near Santa's workshop, where he accidentally gets himself into Santa's suit (which was hanging out to dry) and inadvertently takes control of Santa's flying sleigh when he spooks the reindeer.
At Bugs' house, Bugs is reading A Visit from St. Nicholas to Clyde (during which Speedy Gonzales begs to differ when Bugs reads that there wasn't a mouse stirring). They suddenly hear a noise on the roof, and Clyde thinks that it is Santa, so Bugs sends him to bed. Taz, who landed the sleigh on the roof, then drops down Bugs' chimney, and Bugs, despite noticing that this Santa is in fact "an unreasonable facsimile", gives him a warm welcome. He goes to the kitchen to make a snack for Taz and brings him a plate of milk and cookies; Taz responds by eating the whole table.
Bugs reads his nephew's "brief" Christmas list to Taz, during which Taz starts eating some of the ornaments and lights on Bugs' tree ("Watch out for that green one... it's not quite ripe"). Bugs then says he'll make some popcorn and hands a can of it to Taz, who promptly swallows it before Bugs can get the popper, and since he is standing next to the fireplace, the popcorn starts popping inside his body. Taz then takes a look at one of the presents under the tree, at which point Bugs sets up a fake gift exchange desk and asks Taz if he'd like to exchange it for this bigger one. Taz takes the bigger present and opens it up outside; it is a self-inflating rubber raft. He eats the whole raft, which then expands inside his body and sends him floating into the sky.
Clyde returns and tells his uncle Bugs that Santa didn't put anything in his stocking and also left his sleigh and reindeer behind. Bugs, however, tells him that they just need to return the sleigh to the real Santa. With that, they take control of Santa's sleigh and take off for the North Pole.
In the special's closing scene, Bugs, Porky, Elmer, Sam, Foghorn, and Pepé are riding in an open sleigh pulled by Taz, who then eats the sleigh. With that, Bugs says "Merry Christmas" to the viewers, and Porky, despite his speech impediment, also wishes them happy holidays.
When this short aired as an individual cartoon on ABC's "The Bugs Bunny & Tweety Show", the scene of the Tasmanian Devil eating Christmas tree string lights and electrifying himself as Bugs reads Clyde's "brief" Christmas list was cut.