NOTE: This spoiler was submitted by Kat
In the town of Mossingham, a strange flying object crashes into the nearby forest. An elderly man named Farmer Joe and his dog Bingo investigate the noise and are surprised to find an alien spacecraft and a tentacled creature emerging from it. The pair run back to town screaming, dropping some french fries. The creature happily eats the fries but accidentally drops an egg-shaped device in the dirt.
Meanwhile, on Mossy Bottom Farm, Shaun and the flock are playing frisbee. Their game is brought to end when the frisbee hits Blitzer, the Famer’s sheepdog, and he bans them from playing. The flock tries to continue having fun, this time with increasingly dangerous sports like playing with the Harvester, archery, firing each other from a cannon, etc. only for Blitzer to stop them. The final straw comes when he stops them from having a barbecue so Shaun decides to sneak into the house and order pizza. On TV, the Farmer is watching news about the supposed UFO sighting. The pizza delivery man hears strange noises coming from the woods, but believes it to be a simple frog. He fails to recognize the creature, however, climbing into the delivery bag. Blitzer intercepts the pizzas, but Shaun manages to sneak one back to the barn. Much to the flock’s (and Blitzer’s) dismay, all the pizza boxes are empty.
The next morning, Shaun notices a trail of pizza crusts leading into the garden shed. He discovers the creature, a tentacled rainbow alien named Lu-La, who has telekinetic abilities and vocal mimicry. Seeing that she’s no threat, he introduces her to the flock, who warily accepts her. Lu-La notices the Farmer’s Harvester and commandeers it, thinking it’s a spacecraft. Unfortunately, the Harvester is destroyed when Lu-La tries to launch it into the air. The Farmer is furious and mistakenly blames Blitzer (he was holding the keys), but stops when he discovers crop circles have been carved into the field.
Using nearby objects, Lu-La telekinetically shows Shaun her home planet and spacecraft, along with the symbol of the fast-food joint. Shaun recognizes the fast food joint and shows her the takeout menu, which has a map of where it’s located. The pair set out to find Lu-La’s shift, while the flock makes a decoy Shaun puppet so that he won’t be noticed missing. Meanwhile, at the forest edge, the Ministry of Alien Detection (MAD) is investigating Farmer Joe’s claim. The leader is a severe woman Agent Red and her robot assistant Mugg-1N5. Farmer Joe leads them to where the spacecraft supposedly crashed, but they find nothing.
Taking advantage of the recent UFO sightings, the Farmer decides to build an alien-themed amusement park, titled “Farmaggedon.” This earns him enough money to buy a new harvester. He puts Blitzer to work building the tower of the park but later dresses him up in a spacesuit outfit and sends him into town to hand out flyers. Blitzer leaves the sheep in charge, who, despite some earlier problems, manage to build the tower. Shaun and Lu-La travel into town, using a yellow dumpster as a vehicle. Lu-La wanders into a nearby supermarket. Shaun tries to stop her, but Lu-La eats an entire display case of candy and three bottles of soda. This causes her to get a sugar rush and wreck the store before letting out a mighty burp. Shaun manages to sneak Lu-La out of the store and successfully reach the fast-food joint. Blitzer is putting up a flyer nearby when he notices Shaun venturing into the woods and angrily follows.
Lu-La and Shaun find the crash site, where the ship is revealed to be invisible. Blitzer climbs in after them but accidentally ends up in one of the sleeping bods and is knocked out. Lu-La tries to start up the ship, but it won’t work; it turns out the egg-shaped device she dropped earlier is the key. Shaun finds a photograph of Lu-La’s parents. Reluctantly, Lu-La telepathically shows him how she came to Earth. She woke up in the middle of the night and since both her parents were asleep, decided to play in their spacecraft and accidentally ended up activating it; sending her randomly to Earth. Before the duo can search for the device, MAD arrives (Lu-La’s loud burp alerted them to her presence) and take the ship to their secret base. One of the agents finds the device as well, and Mugg-1N5 bags it as evidence.
In the base, Agent Red examines the device found and takes it to her office for further study. Shaun and Lu-La sneak off the ship and follow Red, thanks to Lu-La mimicking Agent Red’s voice for the door code. In her office, Agent Red opens a safe in her and examines an old piece of paper. Meanwhile, Blitzer wakes up and emerges from the ship. The agents believe he’s an alien because he’s still wearing his spacesuit outfit and try to capture him. In the chaos, Shaun and Lu-La retrieve the device, grab Blitzer, and escape onto the ship. After a few wrong buttons, the ship begins to head to Lu-La’s home planet. Blitzer is naturally freaked out but calms down after Lu-La shows him her memories. Unbeknownst to them, Mugg-1N5 has stowed away on board and is tracking the ship’s movements.
Agent Red sits in her office, looking at the old piece of paper. It turns out to be a childish drawing of two aliens. As a child, Red saw a pair of aliens outside her bedroom window, but when she told her classmates about it, they laughed at her. This is what ultimately fueled her desire to find proof of aliens. On the ship, Blitzer orders Shaun not to touch any of the buttons. Shaun instead ignores him and tries to make himself a pizza, but he pushes the button too long. This makes the machine spit out a large number of pizzas that hit the main controls and send the ship flying back to Earth where they crash onto Mossy Bottom Farm. The ship is completely destroyed, and Lu-La, heartbroken that she can’t get home, loses her rainbow color. Blitzer comforts her as Shaun looks on, remorseful.
Shaun then notices the egg device still works and can be used to contact Lu-La’s parents. Seeing that the signal is strongest when farther off the ground, he enlists the flock to help him climb to the top of Farmageddon’s tower. Meanwhile, the Farmer opens the theme park, which yields lackluster responses. Disguised in robot costumes, the flock sneak into the theme park and head backstage where they can raise Shaun up. Agent Red arrives at the crash site and sees the park’s lights, so she turns her car into a robot and heads there. Blitzer arrives backstage to help Shaun but the Farmer puts him in a fake rocket and raises him onto the stage, leaving Shaun stuck halfway off the ground. The Farmer proceeds to put on a show about the UFO landing in Mossingham but the crowd boos and throws food at him. Lu-La climbs up to Shaun but is unable to use her powers because she’s still upset.
Agent Red suddenly arrives and, still thinking Blitzer is an alien, attacks the rocket. She pulls him out, but his costume comes off, and she sees he’s an ordinary dog. The audience laughs, which brings back painful memories for Agent Red. But she then notices Lu-La climbing the tower and begins to pursue her. The flock quickly jump onto the robot and start attacking it. Timmy, the baby of the group, is able to slip inside and turn the robot off. Shaun and Lu-La reach the top of the tower and successfully manage to get a signal to Lu-La’s home planet. Unfortunately, Agent Red is not finished. She hot-wires the robot and continues climbing after them. Just as she reaches the top, Blitzer fires himself out of the cannon the flock used earlier and knocks Agent Red off. The tower starts to fall apart but just before the trio hit the ground, they are saved by a bright light. It’s Lu-La’s parents!
Lu-La happily embraces her parents, who are relieved to see she’s alright. She introduces them to Shaun and the flock. Suddenly, Agent Red emerges from her destroyed robot. She recognizes Lu-La’s parents as the two aliens she saw as a child. Finally having found her proof, she happily embraces them and leaves. Lu-La tearfully hugs Shaun goodbye before departing with her parents. The audience, who think this was all part of the show, applauds wildly. The next morning, the newspaper declare the show a hit. Blitzer goes to tell the Farmer, but he’s nowhere to be found. On Lu-La’s ship, the aliens are surprised to find the Farmer on board and are forced to make a quick U-Turn to return him to Earth.
In a mid-credits scene, Blitzer and the flock happily play frisbee while the Farmer uses his new Harvester. Unfortunately, the frisbee flies into the Harvester’s gears, blowing it up. The Farmer angrily screams as Shaun, Blitzer, and Timmy hug each other in fear.