In the episode, Chris watches Iggy for the day and lets Rosita play with the dog while he's working at Hooper's Store. During a game of fetch, Iggy comes across a letter I that Telly Monster and Elmo have built. Mistaking the I for a stick, Iggy grabs it with his mouth and runs off, sending the monsters on a wild chase to get it back.
This same puppet had appeared in episode 4147, played by Joey Mazzarino, as a glockenspiel playing dog with Randy Jackson. The collie also appeared on the introduction video for Pretend Day on Sesamestreet.org.