When Timmy breaks his dad’s sentimental, grade school trophy and gets punished with being grounded to his room, he wishes himself back in time to stop his dad (as a kid) from ever winning the dumb thing in the first place. Returning to the present, Timmy discovers that the world is an entirely different place due to his “tampering” with history and in this alternate reality, he was never born and thus, Cosmo and Wanda are no longer his godparents. With the help of 1970s Cosmo and Wanda, Timmy must go back into the past and undo the damage he created in the timeline or else suffer the consequences of the alternate reality his meddling created.
During a sunny day in Dimmsdale, many children are outside playing. The exception is Timmy Turner, who is stuck inside his house doing chores while his parents exercise outside. Timmy’s fairies appear alongside him, Cosmo suggests that he wishes up heat vision to melt the dishes and other chores, while Wanda suggests that Timmy simply wish his chores done. Timmy decides to go with the superpower, and wishes for heat vision. Laughing wickedly, Timmy proceeds to melt everything around him, including his fairies. He then happily walks away to finish his other chores with Cosmo noting they have made him very happy. He melts the laundry and the toaster before heading for his dad's room. He then makes the error of melting his Dad’s prized trophy so he doesn't have to dust it by hand. This causes Mr. Turner nearby to double over in pain, claiming that his “trophy senses are tingling”. He barges back into his house and sees the damage that Timmy has caused, including his trophy. After angrily yelling at Timmy for destroying the entire room and his prized trophy, which Dad had won when he was Timmy’s age, so as punishment, he ground his son by sends him to his room until he learns responsibility for other people's property.
While in his room being grounded, Timmy wonders why his father got so upset over a trophy he won thirty years ago. Wanda explains that it had sentimental value to him, and that Timmy should apologize to his father. Timmy guesses he should, however Cosmo then suggests to Timmy that he go back in time and prevent his father from winning the trophy instead, which Timmy finds to be a better idea much to Wanda’s annoyance. Cosmo gloats at having two wishes granted to Wanda’s zero, and then they wish up the Time Scooter for Timmy. While traveling back in time thirty years, Wanda suggests that he should simply go back in time and prevent himself from melting the trophy instead, but she loses Timmy’s attention when they materialize in 1970's Dimmsdale.
Not long after Timmy and his fairies end up in the 1970s, Cosmo reminds them that they were still fairies in the 1970s as well, just as Cosmo and Wanda’s 1970’s counterparts appear along next to them with Billy Gates. Cosmo and Wanda decide to stay behind with their 70’s selves to “find themselves” and dance, while Timmy leaves to go find his father. Eventually Timmy comes along his father. Timmy discovers why his dad is named "Dad", yet the audience remains unaware due to a passing truck horn. Timmy's Dad then shows Timmy's mom, whose name is also left hidden due to the same truck gag, and promises that he'll give the trophy to her when he wins the race. As his father leaves, Timmy plots a way to cause his father to lose the race.
Nearby, Cosmo and Wanda are showing off a computer to their 1970’s counterpart. Billy Gates comes along and (erroneously) says he will one day link all computers together and call them the “Internet”. Cosmo suggests to Billy that he call it the “Timmy” instead.
At a local ice cream shop, Timmy is making his father eat lots of junk food as part of a training regimen, as well as run with cinderblocks all day, and telling his father scary stories from the future at night, such as “500 TV channels… but with nothing to watch”, causing Dad to scream in horror making him unable to sleep all night until it was time for the race. At the day of the race, Mr. Turner comes in last, and his “reward” for coming in last place is being sent to Dictator School. 2000 (present-time) Cosmo and Wanda disappear suddenly, so Timmy goes back to his time with 1970’s Cosmo and Wanda to investigate.
After returning to his time, Timmy notices that everything in Dimmsdale has become more bleak, which is part of a dimension named 2000A (describing this alternate timeline Timmy has created). Chester and A.J. confront Timmy, demanding his papers, and explaining that Timmy's dad has taken over the world and turned Dimmsdale into “the happiest place in the world, or else”. Chester and A.J. do not recognize Timmy because he doesn't exist in this future, and Timmy then realizes why his godparents disappeared: his dad never met his mom because he never won the trophy which means he was never born and because he was never born, Cosmo and Wanda are not his godparents. Timmy rides the Time Scooter to his old house, which has become a military fortress. Timmy meets his father, who gives Timmy a tour of the house and shows him pictures of Dad graduating from Dictator School, taking over the world (with smiles), and a pedestal where he would put a trophy if he had one. Timmy asks Dad why he is so happy all the time, and he explains that thirty years ago after losing a race and the love of his life, he drove into denial, and as ruler of the world he made everyone else do the same.
Timmy tells his father that he can’t be happy all the time, but Dad takes this as rebellion and sends his guards after Timmy. 1970’s Cosmo and Wanda poof up a lava lamp to distract them, and Timmy makes his escape with the time scooter to return to the past and find a way to undo the actions he has done to cause 2000A.
Timmy returns to the 1970s to set things right, first by taking the alarm clock so that Dad and his sleeping counterpart cannot wake up. Timmy then steals his father’s clothes, and attempts to compete in the race as his father. However, Timmy also quickly realizes that he is the slowest kid in his class after all the other kids take off in front of him. While venting in frustration, Timmy’s heat vision melts the shoes of a girl in front of him and causes her to stop. Timmy realizes he never wished away his heat vision, and proceeds to melt all the other racer’s shoes, allowing him to easily win the race and the trophy. Timmy, still disguised as his Dad, gives the trophy to Mom and tells her to wake him up at his house later and tell him (the real Dad) of the race in excruciating detail. This action destroys the 2000A timeline & 2000 Cosmo and Wanda reappear, meaning that Timmy’s plan worked and the timeline was changed back to normal. Cosmo and Wanda say goodbye to their different time counterparts, then Timmy decides all he should do now is simply apologize to his father for melting the trophy.
After returning to his time, Timmy meets with his father in the living room, who is looking for a new trophy on the “Timmy computer network”. Timmy apologizes to his father for melting the trophy, and Dad accepts the apology, explaining that he “hardly remembers the race anyways”, causing Timmy to laugh nervously. Mr. Turner gives his son the melted trophy so he can give it to a girl that Timmy thinks is groovy. Shortly after Timmy’s Dad leaves, another Timmy, Cosmo, and Wanda; all wearing futuristic clothes; appear suddenly near Timmy. The future Timmy grabs the trophy from present Timmy, flattens it with a mallet made of energy, and then vaporizes it with heat vision. Timmy protests on this, but his future counterpart tells him “You’ll thank me for this later” before they teleport out of the room. As Timmy says, “I’m welcome?”, his mother comes in and says to him “Oh Internet, breakfast is ready!” Timmy then realizes that Cosmo had caused another timeline named 2000B, where his name is Internet and the global computer network is called the "Timmy".