Despite Beverly's wishes, Jackie's parents allow Adam to watch "A Nightmare on Elm Street" and a disagreement between the families ensues. But Beverly dreams of facing off with horror icon Freddy Krueger, which teaches her an important lesson about her son's relationship with Jackie. Meanwhile, Erica realizes she's not as popular as she once was when she starts hanging out at William Penn Academy, despite the fact she's no longer a student there.

Adam's obsession with toys is cause for concern for Beverly and Murray, and they try to distract him with a new hobby. Meanwhile, the Dropouts' decide to audition for Star Search, but their egos threaten the band's future.