A pink-haired girl named Stephanie moves to LazyTown with her uncle (the mayor of LazyTown), where she tries to teach its extremely lazy residents that physical activity is beneficial.

Íþróttaálfurinn has managed to change the villagers' negative attitude towards sports, healthy food and all diligence. But when he leaves and the villagers have to manage on their own, they turn out to be very unstable and easily influenced by the criminal Glanni Glæpur, who turns up disguised as a very rich man. In fact, he has stolen the president's car and intends to corrupt the villagers so that he can sell them un-wholesome powder-food and become mayor of the town.