On Halloween, the Simpsons return from trick or treating with bags full of candy. When Bart, Homer and Lisa start devouring candy, so Marge warns them that if they eat too much candy they will get nightmares... which they do.
Lisa's dream is first. While the Simpson are on a vacation at a foreign country, Homer buys a Monkeys Paw at a stand on the streets, which gives the owner the capability to wish for whatever he or she wanted four times. Maggie makes a wish for a new pacifier, Bart wishes for the family to be rich and famous, and Lisa wishes for world peace. However, the aliens Kang and Kodos take advantage of this and invade Earth. Homer gives the paw to Flanders so that he will get bad luck, however, all his wishes turn out great.
Next is Bart's dream. He dreams that everyone in Springfield must act happy, or he will do something to them because he has mental powers. Eventually Homer tries to kill Bart by bashing his head in with a chair but Bart uses his powers and turns Homer into a Jack-in-the-Box. Dr. Marvin Monroe tells Homer that he should spend more time with his son, which he does. Homer and Bart now love each other and Bart wakes up, screaming.
The last segment is Homer's dream. Homer gets fired from the Nuclear Power Plant and finds a job as a gravedigger at the local cemetery. Homer falls asleep on the job in the hole he was digging, and Mr. Burns finds him and uses him for a project to boost plant efficiency. He uses Homers brain for a robot worker at the plant. When the robot is done all he does is sleep and eat donuts. Mr. Burns is annoyed, so he kicks the robot and the it falls on Mr. Burns. That morning Homer wakes up with Mr. Burn's head attached to his body.