The OSS now has a full child spy section, of which Carmen Cortez and Juni Cortez have become agents. They face particularly difficult competition with Gary and Gerti Giggles (Matt O'Leary and Emily Osment), the children of double-dealing agent Donnagon Giggles (Mike Judge), whom Carmen and Juni helped to rescue in the previous film. It is shown that Carmen defends Gary and has a crush on him. After an incident at a local amusement park, where the President's daughter, Alexandra (Taylor Momsen) deliberately sabotages a thrill ride which juggles its passengers, forcing the Giggles and the Cortez kids to compete in the rescue. Donnagon, who has somehow hacked into the teleprompter which the President was reading from, is named the director of the OSS. Juni is fired after being framed by Gary, who was actually to blame, into losing the "Transmooker", a highly coveted device which can shut off all electronic devices. In his new position as director, Donnagon can carry on with his plan to steal the Transmooker, so he can rule the world. After Carmen manages to hack into the database and reinstates Juni's level as an agent, she and Juni follow the trail to a mysterious island near Madagascar, which is home to Romero (Steve Buscemi), a lunatic scientist. Romero has been attempting to create genetically-miniaturized animals, so he can make a profit by selling the animals to kids in "miniature zoos". He had an experiment go wrong after accidentally pouring growth concoction onto the mutated set of animals. When Carmen is captured by a Spork, a breed of flying pigs, she meets Gerti, who reveals to her that Gary is actually evil. Carmen changes her feelings for Gary and sides with Juni, who Gary is plotting against. After a number of action sequences, such as fighting skeletons and being captured by Sporks, the spy kids, along with the help of their family, Romero and Gerti Giggles, destroy the Transmooker and defeat Donnagon and Gary. Afterwards, Gregorio and Donnagon pathetically fight each other. Donnagon is relieved by the President and Gary is fired, while Juni quits due to the impersonal treatment of agents by the OSS. During the credits, Machete has Carmen sing as an undercover pop star in a concert. Carmen says she can't sing so Machete gives her a mic which auto-tunes her voice and a belt that helps her dance. He also gives Juni a guitar that plays itself. After the performance, Machete informs Carmen that he did not put the batteries in.
- Ash Ketchum, Pikachu, Misty, Togepi, Brock and the Pokemon gang, Simba, Nala, Timon, Pumbaa, Zazu, Kovu, Kiara, Ma, Uncle Max, Rafiki, Littlefoot, Cera, Ducky, Petrie, Spike, Chomper, Ruby, Guido, Grandpa Longneck, Grandma Longneck and the Land Before Time Gang, SpongeBob SquarePants, Patrick Star, Squidward Tentacles, Sandy Cheeks, Eugene Krabs and the gang, Bloom, Stella, Flora, Musa, Tecna, Layla, Stan Marsh, Kyle Broflovski, Eric Cartman, Kenny McCormick, Jean-Bob, Speed, Puffin, Terk, Tantor, Louis, Ray the Firefly, Genie, Iago, Sebastian, Baloo, Bagheera, King Louie, the Vultures, Jiminy Cricket, Mickey Mouse, Donald Duck, Goofy, Kenai, Koda, Rutt and Tuke, Fu Dog, Roger Rabbit, Woody, Buzz Lightyear, Charlie Barkin, Itchy Itchiford, Jack Skellington, Chanticleer, Owen, Izzy, Bowser, Mistress Nine, Bowser Jr., Ranamon, Oogie Boogie, Bob the Tomato, Larry the Cucumber, Junior Asparagus, Jimmy and Jerry Gourd, the Powerpuff Girls (Blossom, Bubbles, and Buttercup), the Rugrats Gang, Carly Shay, Sam Puckett, Alvin, Brittany, Bobby, Cindy, Oliver, Freddie Benson, Spencer Shay, Gibby, the Muppets (Kermit the Frog, Miss Piggy, Fozzie Bear, Gonzo, Rizzo the Rat, Waldorf and Statler, Sam the Eagle, Animal, and the Electric Mayhem), Popeye, Olive Oyl, Popeye's Nephews (Peepeye, Poopeye, Pipeye, and Pupeye), Scrooge McDuck, Huey, Dewey, Louie, Webby, Launchpad McQuack, Chip and Dale, Lilo, Stitch, Pleakey, Jumba, Mario, Luigi, Princess Toadstool, Toad, Yoshi, Donkey Kong, Diddy Kong, Sonic the Hedgehog, Miles "Tails" Prower, Knuckles the Echidna, Amy Rose, Cream the Rabbit, Cheese the Chao, Shadow the Hedgehog, Rouge the Bat, Team Chaotix (Vector the Crocodile, Espio the Chameleon, and Charmy the Bee), Silver the Hedgehog, Blaze the Cat, Spyro the Dragon, Sparx the Dragonfly, Banjo and Kazooie, Barney the Dinosaur, Baby Bop, BJ, Riff, The Griffins (Peter, Lois, Chirs, Meg, Brian, and Stewie), Pocahontas, Meeko, Flit, Princess Aurora, Peter Pan, Tinkerbell, Terrence, Fawn, Rosetta, Silvermist, Iridessa, Vidia, Alice, Hercules, Phlioctetes, Pegasus, Phineas and Ferb, Isabella Garcia-Shapiro, Alex, Marty, Melman, Gloria, The Penguins of Madagscar (Skipper, Kolwalski, Rico, and Private), King Julien, Maurice, Mort, Taran, Princess Eilonwy, Fflewddur Fflam, Gurgi, Jesse Greenwood, Elvis, Randolph Johnson, Nadine, The Goonies (Mikey Walsh, Brand Walsh, Mouth Devereaux, Data Wang, Chunk Cohen, Andy Carmichael, Stef Steinbrenner, and Sloth Fratelli), Aladdin, Princess Jasmine, Abu, Yogi Bear, Boo-Boo Bear, Snagglepuss, Huckleberry Hound, Quick Draw McGraw, Augie Doggie and Doggie Daddy, Wally Gator, Magilla Gorilla, Top Cat, Peter Potamus, Scrooge McDuck, Huey, Dewey and Louie, Webby, Tom, Huckleberry, Becky, Scooby-Doo, Shaggy Rogers, Fred Jones, Daphne Blake, Velma Dinkley, Bugs Bunny, Daffy Duck, Woody Woodpecker, Ttark, Rex, Woog, Elsa, Dweeb, Fievel Mousekewitz, Tiger, Tony Toponi, Tanya Mousekewitz, Yasha Mousekewitz, Papa Mousekewitz, Mama Mousekewitz, Kids World's Adventures Team, Charlie, Itchy, Carface, Killer, Hyp, Mutt, Nod, Oogie Boogie, Pete, The Grand Duke of Owls, Sheldon J. Plankton, Professor Zundapp, the lemon cars, Gremlin and Pacer, Queen Chrysali, Team Rocket (Jessie, James, and Meowth) guest star in this film.