Courage is happily playing with his yo-yo, that is until Eustace appears and sticks a broom in his mouth, telling him to sweep the porch (when it was supposed to be his job). Eustace then throws Courage's yo-yo out the window and then suddenly notices there is a lake outside, and happily claims it, proclaiming it 'Lake Eustace'. The Bagges are happy for a while, however, Nowhere Lake continues to rise and floods into the house. Muriel and Courage try to scoop the water out to no avail, and panic (Eustace doesn't mind, as he can fish without leaving his chair). Courage swims off to solve the problem.
Courage eventually finds that the problem is a dam blocking the river, which a beaver is building. After struggling with the beaver and then a lobster, Courage is buried in concrete, and wraps his yo-yo around a pipe and begins pulling. This makes a strumming sound that the beaver likes, and after he gets freed, Courage is able to talk with the beaver. It is revealed that the beaver liked playing music as a child (and still does), but his father wanted him to work with construction instead. Courage starts playing music with his yo-yo, and the beaver eventually begins rhythmically slapping his tail, which brings down the dam. Nowhere River flows free again, and Courage and the beaver are later seen playing music at a jazz club, with Muriel, Eustace, and the beaver's parents listening.
- When Courage is looking through the snapshots of the Beaver's life, there's a word pun behind the Beaver's father. "That Dam Beaver", which is implied to be the company the Beavers work for; it also doubles as a way to yell at the father for smashing his son's dreams.