King Triton and his wife, Queen Athena, rule over the underwater kingdom of Atlantica, which is filled with music and laughter. They have seven young daughters, the youngest of whom is Ariel. The merfolk are shown relaxing in a lagoon above water, and Triton gives Athena a music box. Suddenly, a pirate ship approaches. Everyone escapes except Athena, who is crushed by the ship when she tries to save the music box. Devastated by Athena's death, Triton throws the music box into the ocean and bans music from the kingdom.
Ten years later, Ariel and her six older sisters live under a strict routine maintained by their governess, Marina Del Rey and her assistant, Benjamin. Marina hates being the girls' governess and longs to be Triton's attaché, a job currently filled by Sebastian the crab. Ariel is frustrated by their current lifestyle, which brings her into conflict with her father. One day, Ariel encounters Flounder, a young fish whom she later follows to an underground music club. She is overjoyed by the presence of music, and is shocked when she sees Sebastian performing there. When her presence is revealed, the entire band stops playing and hides, believing Ariel will tell her father about them. Ariel sings a song explaining her love of music and the remembrance of her mother and she joins the club with an oath.
Ariel returns to the palace, and her sisters confront her over her disappearance. She explains where she was, and the following night all seven sisters go to the club to have fun. Marina secretly finds them, and she later reports their activities to Triton. Sebastian, Flounder and the band are sent to jail, while Marina gets the job she wants.
Triton confines his daughters to the palace, which results in Ariel asking him why music isn't allowed. Triton refuses to answer and shouts that he won't have music in his kingdom. Distraught, Ariel says that Athena wouldn't have wanted music to be forbidden and angrily swims to the girls' bedroom, her saddened sisters soon following. That night, she decides to leave Atlantica and frees the jailbirds. Sebastian leads them to a deserted place far from the palace where Ariel finds Athena's music box, as Sebastian hoped. Ariel and Sebastian decide to return to Atlantica to bring the music box to Triton, hoping that it will change his mind, as he has forgotten how to be happy after Athena's death.
On the way back, they are confronted by Marina and her electric eels. Marina wants to stop them so she will retain her position of "power", and a struggle ensues. It ends when Marina barrels towards Sebastian, but Ariel pushes her away, getting hit in the process. Triton arrives in time to witness this, and he is remorseful for his actions. He sings the lyrics of "Athena's Song", and Ariel wakes up. The film ends with Triton restoring music to Atlantica and appointing Sebastian as the new court composer, much to everyone's glee. Everyone rejoices except Marina, who has been sent to prison.
Inside the prison cell, Benjamin, who was also arrested for knowing about Marina's evil plan, asks Marina if she's learned her lesson. She reluctantly says yes, and Benjamin asks Marina to dance with him. They begin to dance from inside the cell.
The original poster shows that Rex, Dweeb, Elsa, Woog, Mickey Mouse, Donald Duck, Goofy, Discord and The Phantom Blot were going to be guest starring in this film. But because Yru17 had already have them in this upcoming film Littlefoot's Adventures of The Little Mermaid: Ariel's Beginning, 76859Thomas decided not to feature any of these characters in this film.