When Stu Miley fell into his dream world, he met Monkeybone as another villain named Hypnos plans to use Stu's body to get a chemical substance that a girl named Julie developed that gives people and animals nightmares known as the Oneirix.
Upon being sent to the institute by Hypnos upon reminding him of his mission, Monkeybone (in Stu's body) ends up successfully stealing the Oneirix switching it with another juice. Monkeybone obtains the Oneirix and puts it inside stuffed monkey toys of himself (Monkeybone) so that those who touch them will be infected and given nightmares.
With help from Miss Kitty, Stu escapes from his imprisonment. Monkeybone in Stu's body prepares a pinata for the Monkeybone farting dolls at the party.
Meanwhile, Stu reveals Hypnos' plan to Death and convinces her to send him back for only an hour, only to find himself in the body of a dead athlete organ donor. As he flees the morgue attendants, Stu finds out about Monkeybone's planned party and heads there with the extractors still in pursuit.
At the party, Stu's agent Herb exposes himself to the Oneirix in the Monkeybone doll and ends up seeing in the mirror that his clothes are coming to life. This causes Herb to run through the party naked, telling everyone that the clothes have come to life and turned evil. After that, Monkeybone in Stu's body tells everyone to forget about it as he brings down the Stu pinata containing the Monkeybone Dolls.
Stu uses Monkeybone's main characteristics from the comics to cause him to panic and escape. A chase ensues, culminating with Stu and Monkeybone battling each other while clinging to a giant Monkeybone balloon. The balloon is eventually shot down by a passing incompetent policeman and both Stu and Monkeybone fall to their deaths.
Back in Downtown, Stu and Monkeybone are falling toward Down Town where the residents cheer on their fight. Just then, all of the rides stop and a giant robot emerges near the Revive-O causing everyone to flee the area. When Stu and Monkeybone are caught by it, the operator of the robot is revealed to be Death who seems quite cheerful despite the circumstances. Monkeybone tries to have Death let him go to the bathroom, but Death places Monkeybone back in Stu's head which is where he belongs.
Stu Miley created Monkeybone to be the opposite of his introverted, shy, and sexually dormant self. As shown in the film, Monkeybone is that of a perverted, sex-crazed, loudmouthed, and constantly fast-talking monkey who constantly annoys Stu whenever possible as due to being opposites, they usually do not get along.
Monkeybone is shown to be deceitful and hates being a figment of Stu's imagination which is why he planned on taking Stu's body, showing his selfishness. Monkeybone is also very egotistical as he loves merchandise of himself and sees himself as highly loved character. He is also shown to be obsessed with women and being perverted as he is a physical representation of Stu's sex drive.
Monkeybone tends to be a coward and usually screams and hides when panicking and is horribly afraid and paranoid of being stuffed in Stu's backpack as Stu usually stuffs him in there to shut him up.