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Episode Title: Barbie in the Nutcracker.
Episode Description: The frame story is of Barbie's young friend, Kelly, having trouble performing a ballet move and her fears of going onstage. Barbie tells her a story of The Nutcracker to cheer her up.
A girl named Clara lives with Drosselmeyer, her stern grandfather, and Tommy, her younger brother. On Christmas Eve, they receive a surprise visit from their Aunt Elizabeth, who comes with gifts for her niece and nephew. Clara receives a Nutcracker that Aunt Elizabeth tells her contains the heart of a prince. Tommy tries to grab the doll from Clara, but in the scuffle, the Nutcracker's arm is broken.
Clara fixes the Nutcracker and falls asleep near the Christmas tree. She awakens to see her Nutcracker suddenly alive and fighting the Mouse King and his mouse army. When Clara tries to help, the Mouse King shrinks her down to his size, though he is still unable to defeat them and temporarily retreats.
The Nutcracker explains that he needs to find the Sugarplum Princess who is the only person who can stop the Mouse King from taking over his world. The wise owl of the grandfather clock advises Clara to follow the Nutcracker, since the Sugarplum Princess is the only one who can make Clara her original size again. The owl also gives Clara a locket that has the power to send Clara home after they find the Sugarplum Princess...