Three years after the events of the first film, Lenny Feder has relocated his family to his hometown, where his friends Eric Lamonsoff, Kurt McKenzie, and Marcus Higgins live. Lenny wakes up to find a reindeer in his bedroom, which wreaks havoc through the house until he uses his daughter Becky’s stuffed animal to lure it outside. Lenny dismisses his wife Roxanne’s suggestion that they have another child; Eric worries that his wife Sally is encouraging their children’s self-confidence above all else; Kurt gives his wife Deanne a gift for their anniversary, which she has forgotten; and Marcus prepares to spend the summer with Braden, his son from a past fling, but is intimidated by the tall, tattooed teenager, who deeply resents him.
Roxanne, Sally, and Deanne are dismayed to learn that their attractive new yoga teacher Kyle is gay. Lenny commandeers his children’s school bus from the unstable driver, Nick Hilliard, and takes everyone to their last day of school. He picks up Kurt and Eric and visits K-Mart, where they are joined by Marcus, who has sent Braden to school. Kurt persuades Lenny to throw a party for the first day of summer, and the friends discuss Lenny’s childhood bully Tommy Cavanaugh. Police officers Fluzoo and Dante escort them to Becky’s ballet recital at McDonough Elementary, where Lenny runs into Tommy, who openly threatens him.
As school ends, Kurt’s daughter Charlotte agrees to go on a date, Lenny’s younger son Keith struggles with his own bully Duffy, and Charlotte and Keith’s older brothers Andre and Greg accompany Braden to an abandoned quarry, where they join a college party.
After humiliating their old rival Dickie at the Ice Cream House, Lenny, Eric, Kurt, and Marcus visit the same quarry, where they swam during their youth, only to be confronted by a hostile college fraternity led by Milo and Andy, who force them to jump into the water naked. Finding their fraternity house vandalized, the frat boys blame Lenny and his friends and swear revenge. Later, the friends take Marcus’ van, vandalized by Braden, to Eric’s auto body shop, and Marcus inadvertently rolls through town in a giant runaway construction tire.
Lenny learns that Keith is a gifted football kicker, but accidentally breaks his son’s leg. Eric apologizes to Sally for avoiding her to spend time with his mother, and endures a sexually charged car wash from male cheerleaders. Lenny becomes suspicious of Kyle’s relationship with Roxanne, who is angered by her employee Penny’s lifelong obsession with Lenny. Marcus bonds with Braden, Charlotte goes on her date, Andre passes his driving test overseen by Wiley, and Greg succeeds in asking out Nancy.
Roxanne tells Lenny that she is pregnant, and most of the town arrives for the Feders’ 1980s-themed party. Lenny realizes Roxanne is not having an affair with Kyle, who has repaired Becky’s stuffed animal, and challenges Tommy to a fight, but Tommy takes a dive to allow Lenny to save face in front of his own bullied son. Soon after, the fraternity crashes the party, looking for the culprit of the frat house vandalism, to which Braden admits his role. When the fraternity members insults the townsfolk, a massive brawl breaks out between them. The partygoers eventually defeat the fraternity with Andy getting attacked by a wild reindeer thanks to a tactic by Becky.
Afterwards, the friends, Nick, and Dickie enjoy a meal at Mrs. Lamonsoff’s house, reminiscing about their childhood together. Eric’s mother reassures Lenny about his new baby, and reveals that Eric was accidentally conceived in the men’s bathroom at a New England Patriots game. Lenny returns home to Roxanne and they reconcile, looking forward to their growing family.