The group enters Hop Hop Hop Town just as children are disappearing in the town. They go to the Pokémon Center and notice the Pokémon are not feeling well. Officer Jenny soon picks up sleep waves on her radio. They track the source to a huge mansion on the top of a building where inside a Hypno and a Drowzee are sitting on a table. The people there have been using Hypno as a sleep aid and this has been generating sleep waves that was sapping the energy of the Pokémon in the center. Misty takes a look and starts acting like a Seel. Misty leaves the building and runs to a remote forest area where all the missing children were hypnotized into thinking they were Pokémon. They use Drowzee to reverse the hypnotism and also notice it wakes up Pikachu. They take Drowzee to the Pokémon Center and the Pokémon recover too, all except for a Psyduck. Psyduck keeps following them and when Misty falls, a Pokéball rolls towards it. Psyduck gets in and becomes Misty's newest Pokémon, although she wished it had not.
A young boy named Ash Ketchum embarks on a journey to become a "Pokemon Master" with his first Pokemon, Pikachu. Joining him on his travels are Brock, a girl-obsessed Rock Pokemon Trainer, and Misty, a tomboyish Water Pokemon Trainer who may have a crush on him. Ash and Co. end up traveling through various regions, including Kanto, the Orange Islands, and Johto, and then enter the Pokemon League competitions there.
Along the way, they run into many confrontations with Jessie, James, and Meowth, a trio of Pokemon thieves who are apart of an evil organization called "Team Rocket". But every time Team Rocket try to do their evil deeds, they fail thanks to Ash and his Pokemon.