Ash and friends arrive at a festival promoting the Johto region where they meet two Trainers from the Johto Region. Lyra is the spokesperson for the festival and introduces her friend, Khoury, and their starters, Chikorita and Totodile. At the festival, Dawn and Lyra have a battle over an Pokémon Egg. However, Team Rocket also has their eyes on the egg.
The heroes continue the journey, as Ash and Dawn become hungry. Suddenly, they encounter a Marill, who became stuck between walls. Pikachu and Piplup try to pull it out, so it uses Water Gun and gets out. Its trainer comes, being all worried where it went to. She calls it back and introduces herself as Lyra, a trainer from Johto. As the heroes introduce themselves, Lyra offers them to show something; the Johto festival. As they arrive, Lyra gets her Pokégear out and receives a call from Khoury. Lyra tells him she will be back soon.
Lyra admits she is one of the staff that help promote Johto region. She made a commercial that promotes Johto cities. They come to Khoury and meet him and his partner, Totodile. It is not very friendly, so Brock tastes a bit of its food. Seeing how it is not adequate for Totodile, he gets some of Khoury's berries and squishes them, then puts it on the food. Totodile eats happily, which solves the problem. Brock offers Khoury to give him some recipes, while Khoury's dad gives the gang some ice-cream. Lyra introduces them to each other. Lyra tells them she is after the Johto League, while Ash tells her he has seven Badges for the Sinnoh League.
Lyra asks Dawn how many she has. Dawn responds she is a Coordinator and goes to Lilypad Town to compete. Khoury reminds Lyra of the show, where she will advertise the Johto Pokémon. Team Rocket eats and Jessie has an idea. Lyra introduces the Johto starter Pokémon: Chikorita, Cyndaquil and Totodile. She sends Chikorita and asks of Dawn to have a battle with her. Though nervous, she goes on the stage and when hearing Lyra has a prize if she defeats her, Dawn is more confident. Chikorita uses Razor Leaf, hitting Piplup. Piplup retaliates with BubbleBeam, though Chikorita uses Light Screen to reduce damage. Nevertheless, Piplup pecks it. Piplup uses BubbleBeam, so Chikorita uses Light Screen. However, Piplup's Peck causes Chikorita to be defeated.
As promised, Lyra gives Dawn a prize; an egg. Lyra advises her to be patient to see what Pokémon is inside. Suddenly, Team Rocket appears in their balloon, eating the food that was designed for the festival. Meowth spots the egg and goes to get it and succeeds. They go away, but get their balloon popped on a nearby tree and fall into the woods. As the heroes go after them, Jessie ate all the food. They wonder that the egg might be of an Entei, Lugia or Celebi. As they discuss, a Teddiursa got some food. Jessie grabs the food, causing Teddiursa to cry. Team Rocket soon takes the egg and run away as soon as Ursaring uses Hyper Beam on them and goes after them.
When the heroes see Team Rocket is missing, they decide to split up. Ash sends Staraptor, who goes to see where Team Rocket is. They all split up, while Team Rocket runs away. Jessie trips over and loses the egg. Though James and Meowth got the egg, they lose Jessie, as she ran away from Ursaring. Ash, Khoury and Brock see James and Meowth with the egg. James and Meowth see the egg is glowing a bit, meaning it will hatch soon. Staraptor reports to Ash, Khoury and Brock, so Khoury reports to Lyra they found them. Lyra sends Marill, as she has an idea. Marill and Totodile use Water Gun to signal where they are.
They continue to signal and soon corner Meowth and James. James sends Carnivine, who uses Bullet Seed on the twerps. As they are distracted, Totodile snatches the egg. Piplup and Pikachu use Thunderbolt and BubbleBeam, causing damage to James and Meowth. With Marill's and Totodile's Water Gun, they blast off. Dawn gets her egg back and sees it is glowing. Jessie soon finds James and Meowth, while the Ursaring find and surround them. As they come back, Lyra tells Khoury's dad she wants to go with them to see the Contest in Lilypad Town, while Khoury wants to learn more about breeding from Brock. The heroes agree and they all witness the egg hatches into a Cyndaquil. Dawn holds it to meet it and gets burned.
- This is the first episode of the five-part 'Lyra and Khoury' mini-arc.
- Professor Oak's Pokémon lecture takes a seven episode hiatus beginning with this episode.
- Lyra's Johto introduction showed Clair in her Generation IV outfit.
- This is the first time that a main character receives an Egg in which it hatches in the same episode.
- The episode shows many of the new key items within HeartGold and SoulSilver. At their stall, Khoury and his father are selling items such as Apricorns, Apricorn Boxes, Berry Pots, Rage Candy Bars, and Apriblenders
- Music from The Rise of Darkrai and Lucario and the Mystery of Mew is used.
When Team Rocket is eating the stolen food at their balloon, their voices are left undubbed.