Manny and Sid find an injured mother, who gives them her child. Sid is determined they do the right thing, but Manny argues there is no "they", following Sid only out of curiosity. Diego the sabre-toothed tiger attempts to pinch the child, and Manny decides to return baby Roshan himself. Reaching the human's camp, they see it abandoned, and Diego becomes a part of the unlikely team. Together they must learn to work together to care for the child.
Manny, Diego and Sid make it to Half Peak, but the ground erupts with lava. Manny sees Diego struggling on a ledge and saves him, almost sacrificing himself in the process. Diego is thankful but bewildered by Manny's actions, and Manny responds, "That's what you do in a herd." Meanwhile, the other sabre-toothed tigers lie in wait to intercept the troupe. Sid, Diego and Manny set up camp, Sid discovers fire, and the baby takes his first steps. Diego agonises over his dishonesty.
The flock joins a population of migrating wild geese, separating from Amy and Thomas. Thomas and Amy follow the birds, deterring the poachers and making an unscheduled landing. That night, Amy asks Thomas why he never visited her, pressing him for an honest answer. The next day Thomas ultra-light suffers structural failure. Thomas tells Amy she must continue the journey alone, but Amy is hesitant. Thomas reassures her that she is strong and capable, just like her mother.
Amy makes the last leg of the journey alone. Meanwhile, at the North Carolina sanctuary, a crowd of environmentalists protest the imminent destruction of the marshes. Knowing Amy is due to arrive that day, naturalist Dr Killan blocks a bulldozer. The crowd cheers as Amy and the flock arrive, effectively teaching the birds to migrate and saving the habitat from development. The journey of the geese also symbolises Amy's journey through loss, migration, accepting her new family.
While Princess Fiona sleeps, Shrek tells Donkey of all the ogre histories written in the stars. Donkey doesn't believe him, but Shrek tells him that "sometimes things are more than they appear", which is also a clue about Fiona. Donkey presses Shrek about his seclusion and Shrek reveals he is unhappy with the way people judge him. After breakfast, Fiona surprises them by not being as ladylike as they expected, echoing Shrek's sentiment about judging before knowing.
Shrek accuses Donkey of coming into the house but quickly realises it's not Donkey. When Snow White is pushed onto his dining room table, Shrek learns there are more uninvited guests than he realises. Outside, Shrek learns that evil Lord Farquaad has evicted all the fairytale creatures. Shrek announces he will visit Farquaad personally to fix the issue. The crowd cheers and crown Shrek their hero. Shrek and Donkey leave for the Lordship of Duloc.
Shrek manages to intimidate a mob attempting to hunt fairytale creatures for a reward by exaggerating his eerier characteristics.
After receiving a kiss from Shrek, Princess Fiona is surprised to discover what she looks like once the curse has been lifted.
After meeting her soon-to-be husband for the first time, Princess Fiona insists on a specific time for her wedding.
Joan arrives home to find the house in pristine condition and everything in order. Lawrence enters, covered in a purple slime, and tells Joan all about her "terrible" children. Joan, thinking he's crazy, sticks by her family and asks him to leave. At the party, Hank Humberfloob congratulates Joan on her perfect event and immaculate home. Later, the family is seen jumping on the couch together as Cat narrates the final scene.
Diego confesses he was leading his new friends into a trap but tries to redeem himself. Sid distracts the sabre-toothed tigers, while Diego and Manny sneak past, but Soto finds them. Diego is gravely injured when he defies his pack to protect Manny, echoing Manny's sentiment of the importance of caring for your herd. Sid and Manny go alone to return the baby, proving than empathy is deeper than cultural differences.
Although training goes well, the natural instincts of 'imprinting' means the geese remain attached to Amy. Thomas worries he has let her down again. While Thomas and Susan talk, Amy sneaks into the ultra-light. Amy proves the geese will fly behind her, but also has a minor crash. Thomas finds Amy unharmed but is shaken by the idea of loosing her again. Later, Thomas suggests building a custom aircraft for Amy, selling off old sculptures to pay for it.
Shrek interrupts the wedding to tell Princess Fiona how he feels and Fiona reveals her secret to Shrek. Lord Farquaad orders their arrest, but Donkey arrives on Dragon to save them. Dragon eats Farquaad and the town cheers, freed of the lord's oppressive reign. Fiona takes love's "true form" and discovers that beauty is more than skin deep. Back at the swamp, Shrek, Fiona, Donkey, Dragon, the fairytale creatures and the townsfolk live in harmony, happily ever after.
Shrek, Donkey and Princess Fiona's friendship grows as they travel to Duloc. Donkey interrupts a special moment between Shrek and Fiona, reminding them of the sun setting. Panicked, the princess escapes to a house to avoid Shrek seeing she is cursed. After convincing Shrek to tell Fiona his true feelings, Donkey goes to find the princess and discovers her secret. As Fiona tells Donkey of the curse, Shrek mishears their conversation and believes Fiona thinks he's ugly.
Duloc soldiers of set up a trade-in stall for fairytale creatures. As creatures with magical powers are imprisoned in cages, Donkey pretends not to speak. When an accident sprinkles him with fairy dust he flies away, taunting the soldiers. Unfortunately, the magic wears off and Donkey makes a run for it, bumping into Shrek. Shrek scares off the soldiers and Donkey decides to stick around. Shrek is not as enthusiastic about his new houseguest.
Amy's sense of place and happiness improve as she cares for the geese. Amy tells Thomas the feeding schedule and asks if he can handle the responsibility, teasing his lack of parental skills. Thomas seeks advice from game warden Glen, who tells the family that domestic geese don't learn to migrate and have to be pinioned (clipped). Amy protests and Thomas kicks Glen off his property. Amy freaks out after a mishap in the shower, and Susan reassures her they will protect the geese to calm her.
Shrek and Donkey defeat the soldiers Lord Farquaad set upon them. Farquaad crowns Shrek the winner and tells him he's "won" a mission. Shrek protests, explaining he was already on a quest to get his swamp back. Farquaad cuts a deal. Donkey and Shrek set out on their new quest to rescue Princess Fiona. Along the way, Shrek explains that ogres have layers and that there is more to ogres than people know.
Shrek storms the church to declare his love for Princess Fiona.