The film starts off with a rocket carrying two boys and a robotic dog: Jimmy Neutron, Carl Wheezer and Goddard. Jimmy is attempting to launch a communications satellite made out of a toaster, hoping to communicate with an alien species he believes exists somewhere out in the universe. Despite his parents Hugh and Judy's protest in talking to strangers. Unknown to anyone, the satellite is picked up near the planet Yolkus, home to an alien race called the Yolkians. King Goobot V and his assistant, Ooblar, watch a pre-recorded message from Jimmy, featuring him introducing himself and explaining about life on Earth.
Jimmy, Carl, and their friend Sheen spot a poster for an amusement park called "Retroland." However, Jimmy's parents refuse to let him go that night because it is a school night, and as a result Jimmy is forced to go his room to think about what he's done wrong after accidentally causing a fire with one of his inventions. Jimmy, Carl and Sheen subsequently choose to sneak out and visit the park advised by Nick Dean, a popular kid.
As the three are at the park, the Yolkians set a course for Earth and kidnap all the adults in the city, leaving fake notes on the refrigerators to tell the kids they've gone to Florida for an "extended vacation". Coincidentally, Carl spots a shooting star (actually a Yolkian ship), so he, Jimmy and Sheen wish for no more parents so they can have fun all the time. The next morning, the kids are initially overjoyed upon discovering the parents have all disappeared, but eventually become despondent over their absence. After hearing a message from his parents that Goddard had recorded while posing as Jimmy last night, Jimmy becomes suspicious of the fact that his parents said they would see him in the morning despite not being there. He soon discovers what has really happened.
Jimmy organizes the other children in town to build spaceships from the Retroland rides to travel to Yolkus and get their parents back. Eventually they are captured by Goobot, who tells them the parents are to be sacrificed to their god, Poultra. He shows the kids Jimmy's video, thanking him for helping him find suitable species for their ritual, before having the children locked up in their cells.
With Jimmy feeling guilty over the fact that his actions led to the Yolkans abducting the parents in the first place, his rival/love interest Cindy Vortex convinces him to stand up and think of an escape plan. After breaking out with the help of Goddard, the children (except Nick, as he turns out not so brave), in accordance with Jimmy's plan, manage to stop the parents from being sacrificed to Poultra the giant chicken.
Everyone escapes aboard a Yolkian ship, but Goobot follows them in his ship at the head of the Yolkian fleet. With the exception of Goobot's ship, all of the Yolkian ships are destroyed when Jimmy baits them into flying too close to Yolkus' sun. Jimmy and Goddard then use an experimental shrink ray to grow to the size of a planet, and blow Goobot's ship into an asteroid: Goobot and Ooblar survive the explosion, but Goobot declares that they have not seen the last of him. Jimmy reconciles with his parents for not understanding strangers, as all the other kids reunite with theirs, and they make it on their way back home.
In a final scene of the film, Jimmy and Carl have breakfast during which Jimmy's parents drink one of his experiments (that causes significant belching), thinking it is real soda and they all laugh out loud. In the post credits scene, Ms. Fowl, the school teacher, is shown taming a worm when having been shrunk by Jimmy's shrink ray prior to the film.