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The game's story concerns the efforts of Kermit the Frog, Fozzie Bear, Animal and Gonzo to rescue Miss Piggy, who has been captured by the evil Dr. Grump and his Grumpasaurus. To do so, they must first survive the challenges of Dr. Grump's carnival rides.
Each level of the game is a different carnival ride, and the player controls a different Muppet in each one. Kermit takes on the Raging River ride, Fozzie navigates the Amazing Ice Cream Maze, Animal drives in the Crash Car Course, and Gonzo flies through the Lost in Space ride. The latter includes a cameo by Camilla, as a health boost.
Once the player has completed these four initial levels, the game continues with the Grumpasaurus Cave, in which the player again controls Kermit. After defeating the Grumpasaurus, Kermit must face Dr. Grump himself.
A PC version of the game was also released, with one for the Commodore 64/128 as well. Gameplay in these early computer versions differed slightly from the NES, as did the graphics (which used a more limited color palette).