Following the events of the previous film, The Muppets find themselves at a loss as to what to do until Dominic Badguy suggests the Muppets go on a European tour with him as their tour manager.
Meanwhile, Kermit has attempted several times to escape the Gulag but is thwarted each time by prison guard Nadya, who is not only aware of his true identity but is as infatuated with him as Miss Piggy is.