The special's narrative, set prior to the events of the series, follows protagonists Phineas and Ferb decorating their city for the arrival of Santa Claus.
But when the evil mad scientist Dr. Heinz Doofenshmirtz uses a machine to ruin the holiday, Phineas and Ferb must find a way to fix it and save Christmas.
"Phineas and Ferb Christmas Vacation" was written by Jon Colton Barry and Scott Peterson and directed by Zac Moncrief, who had been nominated for a 2009 Emmy award for his work on the episode "The Monster of Phineas-n-Ferbenstein" a few months before the special aired.
"Phineas and Ferb's Christmas Vacation" received a large and widespread release from The Walt Disney Company, who showed optimism on it and promoted it through interviews and special broadcasts.
Phineas and Ferb, convert the top of their house into a large, extravagant rest stop for Santa Claus, complete with a sauna, massage table, satellite TV, elliptical center to work off milk and cookies, milk and cookies, special reindeer feeding center, and beard purifier.
Candace (who has sneered at the boys for still writing letters to Santa, declaring it childish), however, is busy trying to figure out the perfect present for her boyfriend Jeremy, and the song "What Does He Want" plays in the extended edition of the episode.
After receiving a Sal Tuscany CD from his "Secret Santa," he is given an emergency danger alert that Dr. Heinz Doofenshmirtz is up to something nefarious.
Doofenshmirtz reveals that his uncle has sent him a special "Naughty-inator," a device that can ruin Christmas—his dilemma is that he simply does not dislike the holiday and is unsure if he should use it, but after carolers begin harassing him with "We Wish You a Merry Christmas" (especially the part where they demand figgy pudding and "won't go until [they] get some"), he activates the machine.
", the loud vibrations destroy the "Naughty-inator," causing Christmas cheer to return to Danville and removing the "naughty" brand from everyone.
In an interview with the Orange County Register, "Phineas and Ferb's Christmas Vacation" was described by co-creator Dan Povenmire as being a "really sweet, warm special that we're really proud to have our name on.