The game opens with Scooby-Doo and the gang visiting Fred's cousin Jed at his special effects movie studio and factory "Monstrous Fright and Magic" or M.F.M., but once they get there, Jed is missing, and his animatronics have gone haywire. They find M.F.M. CEO Winslow Stanton and his assistant Marcy, who inform them Jed is responsible for sabotaging M.F.M. and has not only stolen some expensive animatronics but also a large supply of Mubber (a special compound used make animatronics into life-like special effects monsters). Scooby and the gang thus take it upon themselves to track down Jed and recover the stolen items.