Katie is feeling quite sad as she watches her friends return from a fun day at the beach and she longs to be able to go there with them. Trying to cheer his friend up, Grooty reminds her of all of the wonderful sleep-time adventures that the two of them have had together so far, and sure enough, that night Katie and Grooty find themselves seaside. And once there, they make a new friend who is unlike any they've ever had before, one who shares the incredible gift of Mermaid magic!@