Clay's dad shows up at the Xiaolin Temple with the intention of bringing Clay back to the ranch for good. Clay tries, however, fails to convince his dad that he needs to stay with his fellow Xiaolin Warriors. Daddy Bailey takes his son back to Texas, but Dojo later realizes that Clay's dad is unawarely wearning an inactive Shen-Gong-Wu around his neck, thinking its a lone star. It activates and now the gang must travel to Texas to stop Jack from stealing Clay's Dad's Shen-Gong-Wu.

Jack stupidly sells all his Shen-Gong-Wu, except for the Monkey Staff, in order to buy robot parts so he can build a robot servant. He sells them to Pandabubba, the crime boss that works in Hong Kong's underworld. Pandabubba sends his henchmen all over Hong Kong, equipped with the Shen-Gong-Wu, to loot. The Xiaolin Warriors must figure out a way to stop them, but their faith lacks in Raimundo, as he still isn't a Xiaolin Apprentice.

After the Warriors befriend a mermaid trapped in ice that's being hunted by an ancient warrior, they soon discover that the warrior and mermaid aren't exactly what each appears to be.

With the Shadow of Fear and Sapphire Dragon, Hannibal Bean enters Raimundo's mind to bring out his worst fear and use it against him and the monks. While they are busy fighting his fear, Bean puts his plan into motion to try and slowly break down Raimundo....but soon finds out things may not turn out the way he expected.