The Furious Five and Po are scaring each other with ghost stories....or trying to; only Crane is frightened by Mantis' story about a creature with highly contagious Flu symptoms. Monkey asks Po if he knows any scary stories, and Po tells them about the jiang shi, or hopping ghosts. Jiang shi are spirits who have not been shown proper respect and come out of their graves to avenge themselves upon the living. They can pass through walls, fly though the air, and paralyze their victims with their foul breath before they devour your brains. And if you are bitten by a jiang shi...you become one!
When Po finishes, Tigress admits that his story was terrifying - if she was four! The others tease Po for being scared of hopping ghosts, which he indignantly denies - and nearly jumps out of his skin when Shifu speaks behind him. Shifu says that a request has come in, asking that they check out a report of strange goings-on outside the village. The Five insist that Po should go with Shifu, to the panda's dismay, but he can't refuse.
It's bad enough that it's dark and spooky; it gets worse when Shifu tells Po that they're heading for the graveyard. Po tries to get Shifu to at least wait for morning, but Shifu believes that they are dealing with common vandals and wants to catch them in the act. He leaves Po to wait in the graveyard while he goes to find the Undertaker. Po sits down next to a grave and tries to stay calm. We see a goat's hoof reach up out of the grave and feel around for something. When it touches Po, he can barely sputter out Shifu's name (It is the most dead-on-perfect homage to Lou Costello in "Abbot and Costello Meet Frankenstein" that I have ever seen!) and he falls into the grave and starts to fight the goat, hollering for Shifu. Shifu runs up and scolds Po for abusing the Undertaker, who insists that there was no harm done. He invites them to stay the night and the two bed down in seperate rooms. Po keeps seeing jiang shi, but when he yells for help, they disappear before Shifu sees them, and he scolds Po for making such a fuss about nightmares and they will be returning to the Jade Palace.
Back at the Jade Palace, the Five continue to tease Po about the jiang shi and he starts to think that he was just imagining things, when he hears Shifu calling him. He goes into Shifu's room, sayng that Shifu is right and that he will no longer believe in jiang shi - Shifu interrupts Po to say that Po was right, there are jiang shi, and they are right behind him! The two try to fight the ghosts, but they grab Shifu and take him right through the wall. Po runs and gets Tigress and Monkey, but they don't believe him. Po declares that whether or not they believe him, he's going to save Shifu, and they follow him to the graveyard. There, they meet the Undertaker, who says that with the aid of his mystic staff, he will raise an unstoppable undead army and conquer the world. He was going to turn Po into a jiang shi and have him lead his army, but Po was just too much of an idiot. He has found a much better subject to lead his army - and calls Shifu out to lead the jiang shi against his own students!
Tigress and Monkey fall back in dismay, but Po belives that they still have a chance; a person who is bitten by a jiang shi will completely turn into one only if they eat the brains of the living. If they can hold off Shifu until dawn, he will return to normal. The three of them retreat into the Undertaker's house and block the door, but because the jiang shi can pass through walls, it doesn't help much. Po realizes that if he is bitten, he will have control over himself for a short time and can fight the jiang shi on their terms. He lets himself be bitten and fights Shifu and the jiang shi. The Undertaker urges his ghost army on, but Po manages to get his hands on the mystic staff and turns the jiang shi against their master. Monkey and Tigress breathe a sigh of relief, but then Po loses control of himself and he and Shifu prepare to attack them. Just then, the light of dawn shines through the cracks in the walls and Monkey and Tigress burst out of the house into the open. Po and Shifu follow them and return to normal in the sunlight.
Back at the Jade Palace, Po does some gloating about the fact that he was right all along and that there are jiang shi and they - even Shifu - were wrong. He even makes them say - in unison - "We were wrong!". "Ghost smarty-pants," Monkey grumbles.
- The episode's title is a reference to the classic fable The Boy Who Cried Wolf, which tells about a shepherd boy who repeatedly tricked villagers into thinking a wolf was attacking the flock, and when one actually did, the villagers didn't believe him and the flock was destroyed.
- Mick Wingert as Po
- Fred Tatasciore as Shifu / Hopping ghost
- Kari Wahlgren as Tigress
- James Sie as Monkey
- Amir Talai as Crane
- Max Koch as Mantis
- Christopher McDonald as the Undertaker