Red and Kitty hand down the Vista Cruiser to their son Eric. Eric makes plans for himself and the gang to head out to a concert though his plan hits two snags. First, Red forbids him from leaving Point Place and two, Kelso's girlfriend Jackie just found out she wasn't invited.
Kitty makes it pretty obvious that she is planning Eric's birthday party despite that Eric refuses to have one. Donna asks Jackie what she should get Eric for his birthday.
The boys decide that to greet the President when he comes to Point Place by streaking. Red is given the honor of asking the President a question but really doesnt like him. Donna is embarrassed when she, Bob, and Midge each wear a suit that when put together make an American flag.
To Eric's dismay Donna beats him at basketball. Being embarrassed he makes it his duty to beat her. Red's hours are cut and decides to do some handy work around the house. Fez and Hyde tease Kelso for being totally controlled by Jackie.
Eric gets a new job at a burger joint. Donna's parents were going away and she wanted to spend some 'alone' time with Eric.
The gang nearly have a wreck while skipping school and decide that they should throw a party. To keep the party hidden Jackie offers the pool of the house her mother is trying to sell. After a while they notice a missing beer tap, Kelso goes off to buy one.
Bob thinks that Kitty and Hyde are having an affair, though Kitty is only showing him how to dance. The rest of the kids go Disco. Though Kelso is upset when he believes Fez is hitting on Jackie.
Eric and Donna go to the Drive-in. Eric is upset when Donna invites Jackie and Kelso and they spend the entire time making out in the back keeping Eric from making a move with Donna. Red and Kitty decide to spend the night out, while Fez's American parents think that the music he listens to is Devil music.
Laurie comes home for Thanksgiving with a friend that Eric finds attractive. Donna is warned by Jackie that a college girl is in his home. Kitty tries to avoid the phone calls of her mother-in-law.
Red's mother has come for a nice Sunday dinner. Well, she's having a nice time but everyone else is being drove crazy with her constant complaints. Most of them about Kitty. The only person who is not having trouble with her is Fez.
Eric makes a new friend after sharing interest in his new friends car. Kelso and Hyde are upset when Eric spends more time with the new guy than them. Eric is startled to find out his new buddy is gay.
Red lends Eric some money for a Christmas tree. In return he can keep the left over money. So with a plan to keep the money Eric cuts a tree down off the interstate to keep the money to buy beer and so Kelso can get Jackie a Christmas present. Laurie being the way she is, adds alcohol to the punch and makes Jackie's friends fall in love with Fez.
Jackie invites everyone to her fathers cabin. Eric fells this is the perfect romantic place for himself and Donna. Though not to long before the trip, Kelso kisses another girl, and when Jackie finds out she tells him he can't go to the cabin. He thinks they are messing with him until they take off. So then Kelso decides to follow them. Back home Kitty and Red get upset with each other.
Red becomes furious when Eric scratches the Vista Cruiser. As punishment, Red takes away the car. Kelso who along with everyone else is tired of walking everywhere, borrows his cousins car. Not too long later, the guys end up in jail after the car is reported stolen.
Kitty pressures Eric into inviting Red to a wrestling match with himself and the gang. Jackie begins to be lighter on Kelso after they did it together for the first time. While there, Bob recives help from Fez and Hyde when Midge starts therapy.
Valentine's Day is coming up, and so Eric asks Donna out on a date. After hearing this, Hyde trys to tempt her to be with him. Kitty feels that Red and her don't connect as much as Midge and Bob.
Jackie informs Eric that she is possibly pregnant. Eric passes this to Donna who feels that Kelso should know. Not too long after, Donna goes on the pill. When Kitty, Red, and Bob find out; they are sent the message that Eric and Donna plan to make love.
On career day Eric spends time with Kitty at the hospital, Fez and Hyde spend time with Hyde's mom who is the lunch lady, and Kelso can't seem to find out what his dad does as his job.
On Prom Night, Eric rents a motel room as a space to try to do it with Donna. Fez ends up dancing with his teacher. Also, Kelso doesnt take Jackie to the prom and so she goes with Hyde who takes her out of pity.
The gang heads out for a screening of Star Wars. Red creates a plan that will get him full hours at the plant by making Eric hang out with his bosses son. During this time, Laurie starts fooling around with Kelso for something fun to do.
While painting a weed leaf on a water tower, Kelso falls off after trying to fix the poorly drawn leaf. Since Eric's mom is a nurse they take Kelso to Eric's house. Eric walks into his parents bedroom to see them having sex. Being so disgusted by what he sees he is nearly incapable of doing anything, which includes sleeping. After while his parents come to the accurate conclusion that Eric is on drugs. Though they are right, the clues that led them to the answer are not why he is acting.
Hyde meets a girl who seems just like himself. She tries to convince him to come to New York with her. After feeling there is little challenge in Pong, Red and Kelso try to make the paddles smaller. Jackie tries a hand at Home Ec. but the pie she is trying to make keeps coming out unsuccessful.
While driving Red's mother home, Eric asks her if it would hug her to be nice every here and there. The answer was apparently 'Yes' when his Grandmother kills over in his car.
Hyde is accepted into the Forman house after his mother takes off with a trucker. The gang goes skinny dipping, also Jackie becomes sick.
Eric began to love having Hyde as a homemate but is upset when he thinks his parents like Hyde more. One of Red's friend from the war come to see him.