After someone steals the Honda "H" off Superintendent Chalmers' car, Principal Skinner tries to find the culprit. Nelson is found guilty and Lisa falls for his rebellious ways and soon develops a crush. It is now up to Lisa to change Nelson for the better. Meanwhile, Homer obtains a telemarketing machine, which ends up driving the town mad.
In music class, Lisa is caught looking out of the window at Nelson irritating Groundskeeper Willie, and is given detention. After school, she continues to watch Nelson, and realizes that she has developed a crush on the bully.
Lisa lets Nelson know how she feels about him after attempting to pass him a love note in class, which resulted in Nelson seriously injuring Milhouse (Nelson thought the note was from him). Lisa is resolved to reform Nelson into a model student: She changes his appearance by taking him to the Wee Monsieur (where he is dressed in a sweater and slacks) and giving him a new hairdo (Nelson states that he feels like a tool). The two later share a kiss during their date at the Springfield Observatory (this was Nelson's attempt to shut Lisa up, but he decided he liked it).
However, the influence of Nelson's friends – Jimbo, Dolph and Kearney – proves to win out when they convince him to throw spoiled cole slaw at Principal Skinner's house. Skinner immediately fingers the juvenile delinquents as suspects, and they flee. Nelson takes refuge with Lisa, proclaiming his innocence. Lisa believes him, until Nelson unwittingly lets slip the truth. Lisa realizes that Nelson is always going to be Nelson and ends their relationship, much to the relief of an overjoyed Milhouse.
In the subplot, Chief Wiggum arrests a confidence trick scam artist for telemarketing fraud. Homer witnesses the arrest and sees the discarded autodialer in a nearby Dumpster. Homer takes the autodialer home to use for tele-panhandling.
Homer ends up annoying most of Springfield with his "Happy Dude" confidence trick scam, and it isn't long before Chief Wiggum catches him. Instead of confiscating the autodialer and taking Homer into custody, Wiggum gives him a citation and asks him to bring the autodialer with him to his court hearing. Homer does just that, and is ordered to apologize to everyone he had scammed. He does so using a pre-recorded message and the autodialer, and at the end of the message asks for more money.