At night just before bed, Ray is reading fairy tales to Slimer, but Slimer, much like a toddler, wants Ray to read more stories than is reasonable and gets angry when Ray reveals the book is overdue. Ray points out that they could check the book out again, but Slimer is still sulky. Meanwhile, Egon and Winston are building a machine, then they and Peter decide to go to bed too.
In the middle of the night, Slimer wakes up still angry about the book, and tries to hide it. The fridge is full, and it shows up under the rug, so he hides it in the basement near the machine Egon and Winston were building. However, he accidentally flips a switch, activating the machine.
The next morning at breakfast, Ray asks where the book is, but Slimer plays dumb. They then get a call to the middle of Manhattan, in which a forest of sentient trees has sprouted. The Ghostbusters and Slimer explore the forest and find a house. Slimer starts eating it, and then Winston and Egon determine that it's a gingerbread house. Then, the gingerbread house comes alive and attacks the Ghostbusters. The Ghostbusters zap the house and the trees, but Egon is confused as to how it happened, since the entities don't seem spectral.
He takes a sample of the remains of the entities, then they go back to the car only to find a red-skinned dwarf riding it. He asks the Ghostbusters to guess his name, which makes Slimer realise that this is Rumpelstiltskin. When Ray says Rumpelstiltskin's name, he disappears, but then the White Rabbit and playing card soldiers from Alice in Wonderland appear.
The Ghostbusters and Slimer go back to the firehouse, only to find Little Bo Peep and her sheep running out. Ray notes that fairy tales seem to be coming true, making Slimer realise the book must have had something to do with it, so he grabs the book and puts it back on a shelf at the library. He thinks this will solve the problem, but then a beanstalk grows and giant trash (mostly partly-eaten food) starts falling from the sky. When Slimer explains to the Ghostbusters about the book and the machine, Egon realises that the machine caused the fairy tales in the book to come true because it was meant to turn ghosts solid. He says that he can undo the damage, but only if he has the book, so he, Slimer, and Ray go to the library to look for the book while Winston and Peter fly a helicopter up the beanstalk.
Peter and Winston fly up to the top of the beanstalk, where a giant boy sprays them with a squirt gun and then grabs the helicopter and shows them to his father. The boy giant wants to keep Winston and Peter as pets, but his father tries to eat them instead. One of Egon's devices beeps, signalling that Peter and Winston are in danger, so Egon, Ray, and Slimer quickly find the book, rush home, and put it on the machine. This causes all of the fairy tale characters and objects to disappear, saving Peter and Winston.
That night, Slimer wants another bedtime story, but Ray is sick of fairy tales and decides to show him a magazine centerfold instead. Egon thinks this is a dirty magazine, but it's actually a dessert magazine.
This episode provides examples of
- Animate Inanimate Object: Discussed when Ray mentions that "books don't grow legs and walk away".
- Beanstalk Parody: At one point, a giant beanstalk grows, which houses a gluttonous giant and his son.
- Big Eater: The adult giant spends most of his time eating giant food and tries to eat Peter and Winston also.
- Big "WHAT?!": The Ghostbusters shout, "What?!" when the White Rabbit appears.
- Blowing a Raspberry: Slimer blows a raspberry at Ray for wanting to return the library book.
- Canon Foreigner: The giant didn't have any kids in the original Jack and the Beanstalk parody, but here he has a son who appears to be about elementary school age.
- Covered in Gunge: The giant tomato covers the Ghostbusters in juice.
- Distressed Dude: Peter and Winston end up in danger of being eaten by a giant.
- Don't Go in the Woods: The fairy tale forest is full of sentient trees and a sentient, malevolent house.
- Ectoplasm: Just before the end, Slimer gets green slime on Peter's face.
- Evil Laugh: Rumpelstiltskin does an evil chuckle.
- Faint in Shock: The librarian passes out when she sees Slimer.
- Giant Food: Most of the garbage the giant throws down consists of large foodstuffs, such as a tomato and a bitten chicken drumstick.
- Gingerbread House: The gingerbread house from Hansel and Gretel features. It is partially eaten by Slimer, then attacks the Ghostbusters only to be zapped by them.
- Half-Dressed Cartoon Animal: The White Rabbit is drawn with no pants.
- I'm Melting!: The gingerbread house and trees melt when zapped with the proton packs.
- Instantly Proven Wrong: Slimer says he's solved the problem after returning the book, but then the beanstalk grows.
- Like a Surgeon: When Egon and Winston are building a machine, Winston calls out, "Screwdriver!" and "Wrench!".
- Midnight Snack: Slimer takes a grape from the fridge after finding it too full to hide the book in.
- My God, What Have I Done?: Slimer becomes worried when he realises he might have caused the problem by leaving the book near the machine.
- Our Giants Are Bigger: One giant tries to eat Peter and Winston, and the other (his young son) wants to keep them as pets.
- Noodle Incident: When Slimer starts eating the gingerbread house, he's asked if he skipped breakfast "again".
- Nursery Rhyme: One of the characters to appear is Bo Peep.
- Platonic Declaration of Love: After Slimer kisses Ray, Ray says, "I love you too, Slimer".
- Platonic Kissing: Slimer kisses Ray at the end of the episode.
- Pun-Based Title: The episode's title is a play on "once upon a time".
- Sapient Eat Sapient: The giant has no qualms about eating Peter and Winston.
- Shout-Out:
- The fairy tales in the book are The Frog Prince (never seen, but read by Ray), Hansel and Gretel, Rumpelstiltskin, Alice in Wonderland, Little Bo Peep, and Jack and the Beanstalk.
- When exploring the forest, Peter says he feels like a Smurf.
- When Peter and Winston are about to be eaten by the giant, Winston says, "I think Mikey likes us." This is a reference to an ad for Life cereal, in which the cereal is fed to a boy named Mikey, whose brother then declares, "He likes it!".
- Suddenly Fluent in Gibberish: Ray translates Slimer's babbling.
- This Is Reality: At one point, Ray says, "This is real life, not a fairy tale."
- Toilet Humour: Bo Peep apologises for something to do with the rugs in the firehouse, implying her sheep pooped and/or peed on them.
- Water Guns and Balloons: The giant boy sprays Peter and Winston with a squirt gun.
- When Trees Attack: The forest that grows in Manhattan consists of spooky-looking trees with faces.
