One seemingly normal day, SpongeBob and Squidward are on their way to work when huge asteroids start raining down on Bikini Bottom. A huge drop of goo falls on Squidward, causing the top part of his face to turn orange and become evil. He chases SpongeBob around the perimeter of someone's house until Patrick Star intervenes. Tai and Izzy then arrive to take them to the Mawgu Lair, which has been refurbished by Izzy and Sandy. Soon, aliens emerging from the goo, called Morphoids, start taking over Bikini Bottom.
SpongeBob and Patrick explore the vast Mawgu Lair, where they meet Yugi, Téa, Sakura, Tomoyo, Nate, and Katie again, along with the House of Radcliffe, a group of bullies from Tai's school, led by the group's namesake, Nolan Radcliffe. Lester Plum, a mutual friend of Nate, and Kevin C Cucumber, a not-so-good friend of SpongeBob then arrive, with Lester (reluctantly) joining the heroes, and Kevin joining the House. They make a plan to stop the Morphoids when Elder Shelton arrives to inform them about the technology in the lair. Although Sandy was the one who installed the technology, Izzy and Tai are able to figure it out, and fits everyone with weapons fitting their personality: SpongeBob gets a bubble blower; Sakura receives a device that allows her to partly clone herself; Tomoyo is given a staff similar to the wand that she usually uses; Lester receives a laser shotgun; and Tai, Izzy, and Téa are given weapons similar to the powers of WarGreymon, Tentomon, and the Magician of Faith, respectively; leaving Nate and Katie to use their signature sword and bow (while Patrick receives a chocolate bar). Meanwhile, on the House's side, Nolan and Vertigo receive sound blasters; Ryker is given a hammer that allows him super strength; Mandrake receives a pouch of magic potions; Kevin is given a gun-like balloon launcher; and Sifter is given metal gloves that also allow super strength.
They travel through Bikini Bottom, and they meet Bubble Bass, who grows gigantic and becomes a Morphoid after eating his last patty which had just been covered in goo. The group battles an army of Morphoids to free Gary, Squidward, Sandy, Mr. Krabs, and Plankton from the goo. They defeat Bubble Bass by feeding him Krabby Patties, causing him to vomit a large amount of goo onto SpongeBob. Luckily, SpongeBob doesn't mutate like the others due to his absorbent body, but suddenly speaks in an evil distorted voice when back at the lair getting the goo washed off, saying "Your world will end! My Globs of Doom will rain over your world... and take control... Daa!!!". Tai thinks that maybe it's someone else speaking through SpongeBob. Elder Shelton informs them that a huge robot called the Vessel of Portentia is hidden in the Mawgu Lair, and requires four special components to power it up.
The group moves to Springdale, where Millie, Lester's sister, is playing with a metal taco-shaped spaceship that happened to be the first component of the Vessel of Portentia. As Millie tries to give it to Lester, she becomes mutated by the goo, picks up the component, and runs away. The protagonists free Eddie, Bear, and Alex from the goo, before facing a giant robot, which is being piloted by the corrupted Millie, who tires out of attacking the heroes and is then beat up out of being possessed. The robot drops some goo, which lands on SpongeBob, who complains that this is going to be recurring. SpongeBob celebrates getting the component, but interrupts himself in the evil voice that threatens it will be "smothering" the planet. The group discovers that the absorption of goo in SpongeBob's body has created a wavelength enabling the leader of the Morphoids to talk through him, confirming Tai's theory. SpongeBob snaps out of it when he smells a Krabby Patty that Patrick was holding.
Moving on to Domino City, they find that Morphoid asteroids rain on the citizens, including Yugi's gang, who have been unleashing their monsters to fight back. Goo falls on Summoned Skull's head, resulting in him going on a mutated rampage through town, with the second component in its possession. After freeing Joey, Tristan, and Serenity, they fight Summoned Skull at a power plant, where it crashes into the wall, and goo flies off onto SpongeBob, who accepts the fact it's going to be recurring. They gain the second piece of the Vessel, and it is again at the lair that the Morphoids', Globulous Maximus, reveals his identity through SpongeBob. Patrick tries his Krabby Patty trick again, but to no avail. So, Ryker flicks SpongeBob's nose to snap him out of the trance, which works. SpongeBob tells his group that he saw Globulous Maximus bringing doom, gloom, and evil.
Heading to Odaiba, the group discovers that the goo has turned Kabuterimon into a monstrous giant, preparing to eat TK, Kari, and Davis. After defeating several more Morphoids and freeing Sora, Matt, and Ken, they fight Kabuterimon at the mall. After defeating Kabuterimon, SpongeBob dodges another glob drop, but gets covered by another. The third piece of the Vessel is retrieved, and SpongeBob states that Globulous Maximus is only a few light-years away from Earth, preparing to send more gigantic Morphoids to destroy it.
Finally, they go to Tomoeda and find the fourth and final component of the Vessel of Portentia covered in goo and freeing Fujitaka, Touya, Yukito, and The Star Alliance. SpongeBob pokes the goo to try and free the component, and gets covered in goo, but still retrieves it, and races to the Mawgu Lair, with the others. At the Mawgu Lair, the evil voice of Globulous Maximus informs SpongeBob that he likes him due to his heroics and plans to become him, much to everyone's confusion.
The team inserts the pieces of the Vessel of Portentia and then speed towards space. They confront and defeat Globulous Maximus, who is a large asteroid himself with floating arms and a primary eye (along with several non-functioning others). Following Globulous's defeat, Weevil, Rex, and their cronies appear to capture Globulous for their evil plans, taking over the Vessel of Portentia as it turns black and corrupted, and ejecting the heroes from the robot, while keeping Kevin and the House as unwilling hostages. Globulous Maximus opens up to the heroes, where he says that he does not want to be used for evil and reveals that he was created at the same time as Earth's creation, thus making him a huge orange ball of living goo. He is destroying their worlds, because he was distasteful of his form and thus took out his anger on others. Feeling sorry for him, SpongeBob then tells him to embrace who (or what) he is, and throws Krabby Patties in his mouth to make him feel better.
They then wonder how they will stop Weevil and Rex from taking over the Earth. Globulous states that he has an idea, as he morphs into a huge, orange, and cycloptic version of SpongeBob.
After a heated battle against Weevil and Rex, Globulous and the heroes manage to defeat the corrupted Vessel of Portentia on the moon, and it explodes in space, leaving the villains, Kevin, and the House floating around. Kevin makes fun of their failure, but his friendship with the House comes to an end as Nolan crushes Kevin's knuckle with his fist, while saying "Curses! Foiled again!", much to Kevin's surprise and dismay. Globulous returns the heroes and the main piece of the Vessel to Earth, and says that he will right the wrongs in the universe by taking the moniker "SpongeGlob". The heroes bid him farewell, and SpongeGlob blasts off into space. Meanwhile, as he tries to thank Elder Shelton, SpongeBob sneezes, and the goo finally exits from his body through his many holes, resulting in him celebrating that someone got covered in goo again and it wasn't him. Tai tries to "continue the streak", but Yugi persuades him to let SpongeBob have his moment. Patrick compares this moment to the moment where SpongeGlob was born, while Elder Shelton then summons a typical "The End" sign.
In the post-credits scene, Grouper and the gang of villains (from Movie 3) are seen stalking different targets, while the stranger (from Movies 1, 2.5, and 3) menacingly watches from his lair, with the camera revealing him as Squilliam Fancyson.
