Demographically Inappropriate Humour: SpongeBob watches a dancing anemone on TV, then quickly changes to the sports channel when Gary enters the scene, suggesting that SpongeBob may have been watching something inappropriate.
Growing the Beard: A lot of people consider this the moment SpongeBob started growing its beard, while others say that happened in the second "chunk" of season 1 starting with "SB-129".
The dancing anemone Gary catches SpongeBob watching on TV gained a good deal of attention due to the implication that SpongeBob of all characters was watching something... inappropriate.
"And stop staring at me with them big ol' eyes!"ExplanationThe Flying Dutchman responds to SpongeBob's big-eyed stare at him with this line, so SpongeBob shrinks his eyes to the size of quarters while still staring at the Dutchman. The line became a popular subject of parody, typically being invoked in reference to characters from other works with similarly large or otherwise pronounced eyes.
One-Scene Wonder: The female eel. She's only in the episode for a few seconds, has exactly one line and never shows up again, but her one line is considered one of the funniest in the whole show. She would later appear in Season 13 episodes.
Squid's Day Off:
Hilarious in Hindsight: One scene has Squidward looking in a mirror and imagining SpongeBob saying "I will destroy the Krusty Krab". At the end of the season, SpongeBob does just that due to taking Squidward's strike speech a little too literally.
"Have you finished those errands?"ExplanationA Running Gag in the episode is that whenever a paranoid Squidward runs back to the Krusty Krab, fearing SpongeBob destroyed it, he instead finds it in perfect shape with SpongeBob asking him the above question.
"You will not go back to the Krusty Krab." "I will destroy the Krusty Krab!"Explanation Squidward tries to give himself a pep talk to ensure that he won't return to the Krusty Krab for a false alarm, only to imagine SpongeBob in his reflection's place saying the latter line, triggering him into running back anyway.
Mr. Krabs' face◊ when seeing a naked Squidward run by is often used as a Dull Surprise reaction image to any expected outcome, often accompanied by the phrase, "To the surprise of absolutely nobody."
Squidward: There, now I'll have to stay here and enjoy myself. Ha, ha! I'm not even gonna think about you-know-who at the you-know-what doing I don't care! Ha, ha! Just gonna relaaaaaax!