During the annual Polar Bear Plunge, Mondo is the only participant able to withstand the cold ocean water but loses his bathing suit in view of the entire group of onlookers. Back at school, Milan and her cohorts are compiling a list of the entire school's male population penis sizes when word comes in of Mondo's exposure which places him at the bottom of the list.
Embarrassed by the previous day's events, Mondo tries to slip into school while wearing a disguise. After Wadska tells Mondo and Woodie that someone beat their top score at an arcade game, Mondo spots the list. When he tries to figure out why he is at the bottom, Woodie grabs the list and claims it's because he is the newest kid in school. When Turk singles him out as one of the "little people", Mondo understands the meaning of the "D-List". Mondo's mother Babs returns home to find Mondo packing up to move but convinces him he should stand up for himself.
As Mondo heads off to have a conference with Principal Gurniel, HJ & BJ invite Woodie to a beach party for the top ten finishers on the list as Woodie placed at number five. Mondo argues that the list is unfair and Principal Gurniel brings in Milan to hear her side of the story. Milan argues that she can't be told what to do and the principal also backs her argument as free speech. As they argue, the principal suggests a debate before the school to resolve the conflict.
Mondo has no intentions of going through with the debate but when Jeena gives her support, he changes his mind. As Mondo notices that girls are paying extra attention to Woodie, Wadska suggests they study for the debate. Woodie splits to check in with the girls while Mondo and Wadska head to the Playa Del Toro Public Library.
While Woodie parties at the beach, Mondo and Wadska find their argument against free speech isn't going well. On the way home from the library, Mondo spots Woodie at the beach party and they start to argue about Woodie actually enjoying his placement on the list. Unhappy with each other, they split up. When Turk picks on Mondo the next day, Woodie tries to call him on it but Turk dismisses it. The two soon start to notice how much they miss the other.
Over non-alcoholic drinks at he Tiki Tako, Wadska tells Babs about the boys problems. When she places his sandwich order before him he gets a plan to fix things. Mondo and Woodie both get a text showing that their arcade game score had once again been beaten. Not expecting each other when they arrive, they reluctantly agree to work together to regain their high score.
As they play, they begin to open up to each other and Woodie admits the list is faked as he saw fourth place finisher Casa has a really small penis. The two bond for good during their game finishing move and Wadska reveals himself as the mysterious person who topped their score to get the two back together.
At the debate, Milan, HJ & BJ put on a jiggle show instead of actually debating. As Mondo struggles to come up with a rebuttal, Woodie has a flashback to his junior high days when Milan told him just to make up a lie about a bully to get even. Woodie calls for a recess in the debate and hands Mondo a quick list of names and instructions. Mondo confronts Milan and threatens to distribute his own "SP List" and notes that the first word is "Smelly". Milan argues that no one would accept his list and the truth and Mondo calls her bluff.
Back at the debate, Milan concedes defeat. Principal Gurniel notes that the terms were for the abolishment of the D-List but also abolishes the Honor Roll as well. Mondo gets congratulated by Jeena who noted that his open fly during the debate was enough argument against the list. Woodie claims that his "Smelly People" list would have rocked as Wadska plants a kiss.