The Professor announces that Leela's childhood home, Cookieville Minimum-Security Orphanarium, has named her Orphan of the Year. In another announcement, he shows off a machine that makes phosphorescent glow-in-the-dark noses. Unfortunately, the machine produces enormous amounts of toxic waste. Hermes, being a bureaucrat, demands that the Professor dispose of the waste or bribe him, which either way costs $500. Bender agrees to dispose of the waste for one cent less, and he does so by dumping it into the sewer.
At the orphanarium's award ceremony, the headmaster presents us with a flashback of Leela's arrival. We see that she was left with a note written in Alienese, and a bracelet. Back at the Planet Express building, Leela is in tears over not having parents. Fry takes her for a walk, and she looks up to the stars, wondering which alien world her parents were from. The camera pans back down, and we see two one-eyed sewer mutants looking up from a drain.
Meanwhile, Bender has expanded his one-time dumping into a full waste management service. The mutants grow angry with Bender's disposal technique, and make a rare surface trip, capturing Bender, Fry, and Leela. The mutants sentence the crew to be lowered into a lake of chemicals, which will turn them into mutants as well. Bender, who was still scared, had no DNA; but the mutants said they were going to beat him up later.
Two hooded mutants call out to Leela, then swing the crane around, dropping the crew on the far side of the mutagenic lake. The mutant mob, immune to the effects of the lake, dive in and swim across. Fry, Leela, and Bender take refuge in a mutant home, where they find a shrine to Leela's life. The mob captures them, but after a whispered word from the hooded mutants, the crew's sentence is commuted to exile. They ride a hot-air balloon to a surface access ladder hanging over the lake. Fry and Bender emerge on the surface; but Leela, determined to find out what the hooded mutants know, dives into the chemical lake.
She swims to shore, and finds she is unaffected by the chemicals. Fry heads to the orphanarium to try to get some clues as to what's going on, and the headmaster gives him the note that was left with Leela. Fry takes the note back to the Professor for analysis. As they read the analysis output, we learn the truth: Leela is actually a mutant, but was born "the least mutated mutant ever". Her parents, realizing she could pass as an alien, decided to leave her at the orphanarium and using Munda's background in exolinguistics, left an Alienese note. They agreed that they would rather die than ever let her find out the "shameful" truth.
Meanwhile, an armed and irrational Leela has pursued the hooded mutants through the sewers, back to the home with the shrine to herself. Leela comes to the irrational conclusion that the mutants killed her parents, leaving her an orphan. She plans to kill her parents, and both are willing to let her rather than reveal the truth. Fry falls through the ceiling at the last second and reveals the truth. He takes off the mutants' hoods revealing two middle-age one-eyed mutants. A tearful reunion ensues, and the episode closes with a montage of scenes of Leela's parents watching over their daughter during her life. As a baby, they saved her from falling. As a child, they gave her cookies. As a teenager, they gave her a present for her birthday. As an adult, they covered her with the quilt.