PlotEditWoody is reading the story of Hansel and Gretel to his nephew Knothead and his niece Splinter (both at this time voiced by June Foray). Neither of the kids seem to be interested, though, and walk out while Woody is still reading. However, the kids decide to act out the story by pretending to be Hansel and Gretel and getting lost in the woods (by blinfolding themselves and randomly walking around in the woods). A cat spots the two little woodpeckers and decides to catch and cook them. In order to capture Knothead and Splinter, the cat makes a gingerbread house (from a Ready–Mix Gingerbread House mix) and, through a straw, shoots Mexican Jumping Jelly Beans at the kids. The little woodpeckers eat the jelly beans, which send them jumping to the gingerbread house.
As Knothead and Splinter arrive, they are greeted by the cat whom they know is up to no good, but they go along with him anyway. The cat decides to eat Splinter for lunch and save Knothead for dinner, but Knothead escapes. Meanwhile, Splinter reads the cat a recipe for Woodpecker Pot Pie, and prepares herself to go into the oven along with the pie, while Knothead decides to play a few tricks on the cat. When the cat finally catches the two woodpeckers, he puts them in the oven but Knothead takes the phone with him and calls the gas company to tell them he refuses to pay the bill.
As a result, the woodpeckers emerge from the oven alive, but before they can escape the cat catches Knothead by putting salt on his tail. Splinter puts the cat's tail in an egg beater in order to save Knothead and give him a chance to escape. Once he is free, Knothead takes the cat's tail and paints a fascimile of himself on it. The cat ends up putting his own tail into the oven and burns himself. For the finish, the little woodpeckers give the cat a bowl of soup with a firecracker in it, and make their escape back home.
Knothead and Splinter make it back to Woody's house just as Woody is finishing reading Hansel and Gretel. Because the cat was never shown to have blown up, someone in the audience suddenly says “Hey! What happened to the last firecracker?” All three woodpeckers point to the cat holding the explosive as it bursts.
Though part of the Woody Woodpecker series, its main stars are Woody's nephew and niece Knothead and Splinter, who make their first appearances in this short. The two were well received by audiences, leading to another appearance the following year in Red Riding Hoodlum.