Elena brings all the communities of Avalor together to share each other’s holiday traditions. But when a Doña Paloma scheme causes an overly competitive atmosphere, Elena sets off on a traditional “parranda” and carols through the city to remind everyone of the true spirit of Navidad.
The Kingdom of Avalor is getting ready to celebrate Navidad which is two days away. Isabel's friend Cristina comes in with her father who invites Elena and her family to their village for Nochebuena, the night before Navidad. Armando comes in and tells her they have more guests. Naomi and her father, Carmen and Julio, Mateo and Rafa, and Doña Paloma are all at Avalor Castle to invite Elena to their Nochebuena celebrations. To convince her to come, they all tell her how they celebrate Navidad. To ensure she can go to all of them, Elena decides to have everyone celebrate the next day in Castillo Park. Doña Paloma agrees and invites everyone to her store for any last minute shopping.
The next day at Castillo Park, everyone is setting up for the celebration: Isabel is making a pinata, Carmen and Juilo are doing their cooking, Mateo's group is singing, and Naomi and Daniel have brought a boat. Suddenly, disaster strikes: the goats Cristina's father brought get spooked and wreck the celebration which causes everyone to have a fight. Elena breaks it up and tells them that they will instead build floats for a Navidad parade. Doña Paloma, who sees a chance to make money out of this, agrees. Everyone is all for it and start building their floats. To ensure they buy as much as possible, Doña Paloma lies to each group by telling them that Elena will pick the one she sees as the best float to lead. As Dona Paloma intended, hearing this makes everyone buy as much as they can from Doña Paloma's store to show Elena that their way of celebrating Navidad is the best. Elena tries to tell everyone that it is not a competition but they do not listen and start arguing. The fighting causes the floats to crash into each other in a way that starts a fire that ruins everything. The disaster makes everyone decide to just go home including Cristina, which makes Isabel run home sobbing. Elena is furious when Naomi tells her that Doña Paloma was what made everyone try to outdo each other.
Elena confronts Doña Paloma, who reveals that she did it so she could make money. To remind everyone what the holidays are about, Elena grabs a guitar from Doña Paloma's store and starts singing a parranda with Gabe. As intended, the parradana makes everyone remember what Navidad is really about and they apologize to each other. They all head to Avalor Castle, where everyone celebrates together, to Isabel's joy.
- This is a Christmas special.
- Doña Paloma comitted Greed. One of the 7 deadly sins in the Catholic religion.
- This is Elena's second wardrobe change. The first was in Island of Youth.
- This was Isabel's third wardrobe change. Her first one was in First Day of Rule and her second one was in The Scepter of Light.
- This is the last episode to premiere in 2016.
- Moral lesson: Don't expect too much on the holidays. We only celebrate for family
- There is a book based off of this episode named, Feliz Navidad: A Royal Christmas