The Laughing Puddle is the second episode of season 2.
Chicken, Flem, and Earl are playing a game of Kickball. Cow asks to play. Earl nods. Chicken tells her the rules. He slowly rolls the ball, Cow misses three times and falls; the boys laugh. Chicken tells her your supposed to kick the ball, he slowly rolls it again; this time, Cow kicks it into the bushes.
She runs quickly, but Chicken tells her that she has to slow down, she falls for it. Flem and Earl best Chicken to the bushes. When he does get there, he hears uncontrollable laughter, he commands to know why they are laughing, but they're not; instead, they find themselves staring at a bubbling puddle that is laughing.
They are surprised by this odd phenomenon, Earl begins hitting the laughing puddle with a stick. Chicken and Flem begin to leave Earl with the puddle but when they turn around; he is gone and his stick is still moving. They scream and tell Cow to slow down, who does it.
They get a ladder, Chicken convinces Flem to go and investigate the puddle, but soon Flem is laughing too. He gets Mom and Dad who happily go into the puddle, but they drown too. Chicken, now terrified, goes and gets Cow just as she is about to make her home run. She scolds him because of that, she too was stiff-armed by Chicken to go into the puddle. She begins laughing along with Flem, Earl, Mom, and Dad.
Chicken investigates the town and finds out that the puddle has kidnapped everyone else in town. Annoyed, he curses the puddle and also breaks the fourth wall by saying "When is this cartoon gonna make any sense!?!" He then sacrafices himself to get into the puddle and finds out that on the other side Boneless Chicken is giving a stand-up comedy show. Chicken begins laughing and falls in himself right next to Flem, Earl, Cow, Mom, and Dad. No one can stop laughing at Boneless' jokes despite the fact one wasn't a joke. Boneless Chicken then ends the show.
After the show ended, The Red Guy appears explaining the mystery of the puddle: it's what scientists call, "thick water," which contains molecules the size of watermelons, then reveals that the nightclub that Boneless Chicken was performing was shut down after the events of the episode due to health code violations. Asking if there are any more questions, with him imitating the sound of crickets chirping, he says, "I didn't think so."
Leaving by bouncing on his butt, he ends the episode with, "Ta-ta! That's the real end."