Lisa is failing gym. To make up the grade, she joins a pee-wee hockey league. Soon, her team must face off against Bart's party, putting the pair in direct competition.
Because of impossibly low test scores, Principal Skinner starts to give out academic alerts so the children's parents can understand they are doing poorly. After the various failing kids receive their alerts, Lisa is called up, surprising everyone. It is then revealed that she is failing gym. Lisa, terrified, goes to her PE teacher and is told to join a Pee-Wee team outside of school.
In the meantime, Bart shows that he is excellent at sports, in one match knocking the Gouger's goalie Milhouse down so that he has to be tied to the net to act as goalie, which is about as effective as can be expected.
After a sequence of failed attempts at sports, Lisa finally joins the Gougers, which is sponsored by Apu - which is also Bart's rival team. Turning out to be a far superior goalie, Lisa helps turn the team around and Homer starts paying more attention to her. Bart is troubled about the lack of attention and this is not improved when Marge tries to hang out with him.
After Lisa excels at both sports and school, Bart thinks he might become a scholar. This doesn't work out and after class, Nelson and the bully trio confront Bart and prepare to bully him by beating him up, accusing him of wasting Mrs. Krabappel's time. He is inadvertently saved by Lisa who scares off the bullies and instead of being grateful, he accuses her for stealing Homer's affections away from him. This leads to a rivalry between the entire family, which Marge is less then pleased about, having tried to keep the peace with them and Homer.
When Lisa and Bart play each other, Homer tries to get Marge to choose a side (not taking into account Maggie who actually saves Homer from a flying beer bottle) but Marge and tells him that she loves all three of their kids regardless. The game gets down to the wire, with the stadium split between Bart fans and Lisa fans, while Marge is the only one maintaining neutrality. However, when Bart is chosen to take the penalty shot against Lisa, the goalie, they both reminisce about how they helped each other as younger kids (Lisa giving Bart a bandage after he falls off his skateboard, Bart giving Lisa one of his scoops of ice cream when her own falls on the ground). Lisa and Bart throw their hockey gear on the ice and hug. Homer then remarks that they are losers and the stadium erupts into a riot. Marge is proud of Bart and Lisa, and even Snake is touched, but of course he elects to join the riot as the stadium is torn apart.