Homer takes the family to buy a Christmas tree on Halloween night with the excuse that "in America, everything's way too early". At the Christmas tree lot, the family is surprised by Sideshow Bob, Kang and the ghost of Frank Grimes, who want to get their revenge on the Simpson family. However, a Leprechaun appears and convinces the trio to dance before they attack. Maggie grabs a knife and cuts their heads off, their blood dripping down, revealing the Title Card Treehouse of Horror XXVII.

After the title screen, Frank manages to put his head back on and questions about stopping these people. The screen is then filled with clips from all the episodes so far and a counter goes from 0 to 600. Frank then says that in Hell you watch all the episodes in a row. It then shows a fake episode called Planet of the Couches that captures the Simpson family, with them eventually escaping.

The segment takes place on a post-apocalyptic Springfield, where the city has suffered a drought, and the very little water there still is very expensive. Mr. Burns, who controls all the water in the town makes an announcement to them, saying that a child from each neighborhood has to participate in a gladiator-like battle, and the winner will be awarded a day at Burns' reservoir. Lisa is the selected child from the Nevergreen Terrace neighborhood, and she soon met her coach, Homer. In the battle, Ralph dies before the event starts by getting blown up when he stepped out of the area.

Later, two boys manage to seduce Lisa, but Homer kills them. Later, Homer falls into a trap and is surrounded by other contestants, but Lisa convinces them that they don't have to kill each other. She also convinces the population of Springfield to turn against Mr. Burns. They free all of the kids from the dome and destroy Burns' reservoir, which they immediately regret as the water was completely wasted. However, the water that escaped the reservoir caused a rain, that caused a flood and later an ice age.

Lisa is playing hide and seek with Janey Powell when Ned Flanders' lawn mower suddenly turns on and kills her. At Janey's funeral, Sherri and Terri say that as Lisa has lost her best friend for life on a tragedy and is now interesting. She can be their best friend for life, but they are immediately crushed by a falling tombstone. To forget the trauma of losing three best friends for life in two days, Lisa goes to a counselor, who says to Lisa that she can think about her as her best friend for life, but the doctor is killed by a falling painting.

At the doctor's funeral ceremony, Lisa starts being investigated for the murder of her friends. Chief Wiggum finds sparkle nail polish on Lisa's room and claims that it was found on all four crime scenes. Lisa reveals that she only used it with her former imaginary friend Rachel, whom Lisa spent time with since she had no friends. They played together a lot, but she eventually outgrew her. Lisa than states she never saw Rachael after that, or used that sparkly nail polish either. Chief Wiggum does not believe her and will keep his eye on her.

The next day at the school bus, all the kids fear Lisa except Milhouse, but Rachel appears and asphyxiates him with a plastic bag. Chief Wiggum observes Lisa on the bus and arrests her. At the police station, Lisa mentions that Marge was right about Rachel, which infuriates her even more. Lisa soon realizes that Rachel will try to kill Marge and escapes from jail with Bart's help. Chief Wiggum meanwhile is killed by being stabbed in the neck with a shiv by Snake Jailbird.

Lisa gets home in time to save Marge from being killed and Rachel reveals her plan to kill everyone who Lisa loves and people will blame Lisa as nobody can see her. Rachel tries to kill Homer, but he occupies her with his imaginary friend: Sargent Sausage. Rachel shoves Sargent Sausage into the microwave and he explodes. Lisa then realizes that as Rachel only exists in her imagination, she can turn her into anything she wants, so she turns Rachel into her own mother, who is married to a dentist. Rachel then disappears for good. Homer, saddened by the loss of Sargent Sausage, eats his remains from the microwave, but Sargent Sausage reveals that he can't die, and the segment finishes with Homer ordering him to "get inside his stomach".

In a parody of the James Bond movie series, Bart is being chased by Dolph, Jimbo and Kearney when he enters Moe's Tavern through the backdoor. Moe appears, incapacitates the bullies and opens a secret lair under the tavern, revealing that all the barflies are in fact, secret agents. He then reveals that he wants Bart to take Homer's place, as he was one of their best men who was lost in action.

Later, they receive information on their next target: Remoh Industries, a multi-millionaire company and the new owner of Duff Stadium. At the company, they break in and find out that the president is Homer. He then reveals that he has created a lava machine to make the entire world surrender to him and he wanted all the beer to celebrate. When the agents were going to attack Homer, he sends a horde of people to battle them who have been drugged by the concession stand snacks, Bart manages to escape the fight safely and then kills his own father.

In honor of the 600th episode, the ending features Judith Owen, wife of Harry Shearer, singing a parody of the song "Goldfinger" while showing a selected list of television shows that Fox has canceled while The Simpsons has been on the air.