Mr. Ochmonek's nephew Jake comes to live with the Ochmoneks. The Ochmoneks tell the Tanners that Jake is a problem kid and ask their advice on how to deal with him. ALF can't resist investigating Jake's persona.
The Tanners decide to spend Christmas in a cabin in the woods. They meet Mr. Fowley, a man that fixes broken toys during the year and gives them to kids in the hospital over Christmas. Alf accidentally gets caught in Mr. Fowley's truck as he drives off with Alf and the "rest" of the toys in the back. In the hospital, where the toys are handed out, Alf meets Tiffany, a very sweet, but very sick girl.
ALF is frustrated because he can't vote in the presidential election. He watches a televised debate with Kate and offers his "better" ideas on how to solve the world's problems. This gives Kate some weird nightmares.
Willie and Kate no longer share activities, because one of them has to always stay at home keeping eye on ALF. ALF concludes that they are about to break up and in order to prevent that, decides to add romance to their life.
Kate's mother has decided to get married in the Tanners' house. Unfortunately, ALF develops a Melmacian Hiccup, that keeps getting louder and louder, threatening to draw everyone's attention within a 100 meters (give or take).
ALF learns the concept of Earthly beauty pageant. Since Lynn, having been dumped, is suffering from low self-esteem, ALF enters her in Miss Southland pageant to prove she is pretty and uses the prizes to lure Lynn to participate.
Halloween is approaching and ALF wants to go trick-or-treating. Kate, of course, objects, but ALF persists. He argues that he has a natural costume and tries offering Willie a deal he can't refuse... Lynn presents Lizard to her parents.
The Tanners get the chance to participate in a new TV ratings system. With clever arguments, ALF gets Kate to let him use the system. After learning his favorite programs might get canceled, ALF decides to tweak the numbers a bit.
In one of those moments, when ALF lets his mind wander, he unintentionally walks into Mrs. Ochmonek's sight and greets her. Cue Mrs. Ochmonek panicking and deciding to warn the neighborhood about the "space creature".
ALF has taken a liking to watching Gilligan's Island (1964). He dresses accordingly and has coconut drinks. He's bored at the Tanners' house and takes things one step too far towards Gilligan's Island (1964).
ALF breaks Kate's precious $1,000 painting and gets confined in the garage. ALF can't handle a single night there and makes a bargain with Kate: unless he can behave 7 days in the house, ALF has to move into the garage permanently.
ALF thinks he's won in a publisher's sweepstakes, but the actual truth is that he subscribed to hundreds of magazines. The next leaflet ALF gets his hands on does promise free gifts, but only if the family comes to listen a sales pitch for vacation homes. The Ochmoneks are going there, so Trevor invites the Tanners to come along. It turns out he is a pilot who flew in the Korean War, so they are able to fly instead of a seven-hour drive. The reluctant Willie eventually warms to the idea, but ALF has to stay home.
When the living room TV breaks down, Willie declares that he won't have it fixed, despite ALF's complaints that he has nothing to do but watch TV. ALF keeps pressuring Willie, who discovers that the TV is still under warranty and he can have it sent to the factory for repairs. Except that the factory is in Libya and Willie would have to pay for shipping... ALF thinks Willie has been conned, so he calls Consumer Ed, the guy who fights for consumers' rights on TV... Brian announces that he needs to come up with a project for the Science Carnival. On his own, Brian creates a model of the Solar System. ALF points out that there are inaccuracies and offers to help.
The Tanners are preparing for a garage sale to get some money for house payments. ALF discovers the alluring world of horse racing thanks to Kate's mom who bets on them. When the concept of a bookie is explained to ALF, he gets the bright idea of getting the Tanners some money through betting. When his initial bets yield only profit, the plan seems good... at the time.
Lynn has introduced ALF to rap music, much to Willie's dislike. Willie himself is making the final changes to Brian's song in the school pageant where the kids dress as vegetables. Unfortunately, Brian is suffering from stage fright, which causes him to forget the lyrics. ALF offers to help.
There's a power blackout, so ALF is passing the time by watching the Tanners' neighbors, the Ochmoneks, who are fighting. By dinner time, the power has come back so the Tanners can have dinner. Then comes another, short blackout. Trevor Ochmonek appears at the Tanners' door, seeking peace and quiet from the angry Raquel. Soon after, Raquel comes to demand that Trevor return home. The Tanners persuade him to do so. Night falls and ALF hears the Ochmoneks continue fighting. Suddenly it becomes silent. Too silent for ALF, who's convinced that something foul has happened at the Ochmoneks.
Brian has to lie to his friend who wants to come for a sleepover that the Tanners' basement is flooded, because ALF must be kept secret. Willie then tries to explain to Brian that lying is always wrong even though Brian has to keep lying because of ALF. Lying to the Ochmonecks is also tiring Willie, not to mention having to put up with ALF's antics. Kate suggests Willie talk to Larry, a therapist they know. Of course, Willie has to prove that ALF exists and is not his hallucination, which means that Larry and ALF meet.
ALF starts to go through a phase where his erratic behavior and hunger for cats will, in his own words, make him "ALF to the tenth power". He wants Willie to build a cage where he can be locked in until the phase is over.
ALF is now into gardening, which means he's turned over the entire Tanner backyard. Willie has a problem at work: a lost Mexican boy is at his office and Willie is trying to track down his father. When that fails, and Willie's boss couldn't care less about helping the boy, Willie has no option but to bring the boy home.
ALF bumps his head and loses his memory. All he knows is that his name is Wayne Schlagel and that he's an insurance agent. The Tanners try to make ALF remember who he really is.
ALF still believes that his name is Wayne Schlagel and that he's an insurance agent. Worse still, he has called the police to the Tanners. The Tanners have only a short while before the police arrive, so they try to make ALF remember who he really is by telling more stories from the past.
Willie catches ALF from eating a box of chocolate that was to be a Valentine's Day present for Kate. This incites Willie to give ALF a lecture on how ALF does not respect private property and needs to adopt a new attitude. Also, Kate's mom is moving out of the Tanners' house. The problem is that her new neighbor, Whizzer, wants to come help Dorothy move her stuff. Which means ALF has to hide from him. Kate likes Whizzer and suggests that they invite him over for a dinner. Dorothy doesn't want that. ALF interjects by claiming to have spoken to Dorothy's dead husband Sparky's spirit, who wants Dorothy to move on. Apparently, all Melmacians have the ability to speak to the dead. Dorothy wants ALF to prove his ability and let her speak to Sparky through ALF.
ALF and Kate's mom are arguing about TV. Kate's mom thinks ALF's favorite soap opera, Midwest General, is sleaze, and shows him her favorite, One World to Hope For, which ALF thinks is boring. Angered, ALF argues that he could write a better script for the series than the writers are coming up with. So ALF actually writes a script and sends it in. The production company actually films ALF's script that bears not-so-subtle similarities to the situation at the Tanners' house.