[5] The film stars Michael Caine as Ebenezer Scrooge alongside Muppet performers Dave Goelz, Steve Whitmire, Jerry Nelson, and Frank Oz.

Charles Dickens (Gonzo) and his friend Rizzo narrate the story of Ebenezer Scrooge, a greedy, rude, penny-pinching and lonely moneylender of nineteenth century London, who does not share the merriment of Christmas.

That night, Scrooge encounters the shackled ghosts of his late business partners, Jacob and Robert Marley, (Statler and Waldorf) in his bed chambers.

Along with Dickens and Rizzo, they visit his lonely school days and then his time as an employee at Fozziwig's (Fozzie Bear) rubber chicken factory.

There, at Fozziwig's Christmas party, Scrooge meets a young woman named Belle, with whom he falls in love but loses as he chooses money over her.

Scrooge also takes pity on Bob's ill son Tiny Tim, (Robin the Frog) whom the Ghost comments will soon die if things continue the way they are.

The Ghost of Christmas Yet to Come takes Scrooge into the future where a recent death elicits no sympathy from the inhabitants of London and the stolen possessions of the deceased are sold to a fence named Old Joe.

An overjoyed Scrooge begins spreading happiness and joy around London, agreeing to give money to the gentlemen's charity and reconciling with Fred and Fozziwig.

[6] The longtime Muppets writer Jerry Juhl was hired to write the script and decided to insert Charles Dickens (portrayed by Gonzo) as the stand-in narrator in order to remain faithful to the original prose of the written material.

[7] Henson stated that Gonzo was chosen because he was the least likely choice to play Dickens,[8] while Rizzo the Rat was added to inject some humor and serve as a Greek chorus.

[4] Despite being a modest box office success, The Muppet Christmas Carol did not have a large effect during its theatrical release, having to face competition from Home Alone 2: Lost in New York and Disney's own Aladdin.

The site's consensus states, "It may not be the finest version of Charles Dickens' tale to grace the screen, but The Muppet Christmas Carol is funny and heartwarming, and serves as a good introduction to the story for young viewers.

[20] Janet Maslin, reviewing for The New York Times, said that there wasn't "great show of wit or tunefulness here, and the ingenious cross-generational touches are fairly rare.

"[21] Kathleen Carroll of the New York Daily News gave it three and a half stars, calling it "a delightfully imaginative musical adaptation of Charles Dickens' classic tale" and noting that "it's a measure of Michael Caine's talents as an actor that he's able to give a straight-faced, remarkably convincing performance as the notorious tightwad Ebenezer Scrooge while surrounded by pint-sized veteran scene-stealers", though she did write that "the songs by Paul Williams tend to sound exactly alike.

"[23] Norman Wilner of The Toronto Star, in contrast, called the film "one of the most loyal renderings of Dickens", writing that "Caine, who has always been able to fully become the characters he plays, delivers an unexpectedly strong performance as a human being who plays every scene with hand puppets [and] makes us believe he's been relating to the little fuzzies all his life"; however, he had a mixed review of Williams' songs in the film, and was particularly critical of its closing number.

Nevertheless, Kehr praised Val Strazovec's production design and John Fenner's cinematography believing its "shadowy, naturalistic lighting creates a new look for a puppet film," but derided Paul Williams's songs as unmemorable.

"[29] In London, the Evening Standard's Alexander Walker said that "the Muppets pass their first screen test playing characters other than their felt or furry selves with great exuberance.

"[30] Derek Malcolm of The Guardian was less welcoming, saying that "Scrooge's nightmare is rendered silly and so his turning from swine to saint hasn't the required kick.

Walt Disney Studios Home Entertainment released a 20th anniversary collector's edition on Blu-ray, DVD, and digital copy on November 6, 2012.

However, the song "When Love Is Gone" and its accompanying scene can be viewed in its entirety on the full-screen version of the anniversary edition of The Muppet Christmas Carol, though it is cut in the widescreen format.

[43] The Muppet Christmas Carol: Original Motion Picture Soundtrack contains all of the songs from the film, which were written by Paul Williams, as well as several cues from the score by Miles Goodman.

The performances are by the Muppet characters as well as Caine, and the album also includes the songs "Room in Your Heart" and "Chairman of the Board" that were recorded but never filmed.

[34] However, on December 9, 2020, Henson confirmed to BBC Radio 2 that the original film negative featuring the entire footage of the song had been found by Disney archivists and would be included in all future 4K releases.