Many years ago in Agrabah, Jafar finds a man who sells scarves for a living. The businessman is doing very well for himself despite his humble occupation. He claims that some sound family investments have finally started to pay off. The scarf seller excuses himself to another room where he summons his genie from a bottle. He tells Cyrus that the person he warned him about is here. The scarf man panics. He wishes for Cyrus to be gone to a far off land. Jafar storms in but is too late. The genie and the bottle are gone. Jafar takes his anger out on the scarf salesman, who is soon gone, too. As for Cyrus, he flies through a portal far away from Agrabah. He ends up in Wonderland.
Alice lets the Knave of Hearts know that she wants to find the genie's bottle. Once they do so, they can make three harmless wishes so Cyrus can reappear. Then they can figure out a way to free him forever. Alice will have to trust the Knave to be the bottle-rubber. First they have to retrieve it from its burial spot in the Mimsy Meadows. The White Rabbit eavesdrops on their entire conversation before they head off without him. There's no way to get to the Mimsy Meadows without crossing a huge lake. The Knave can't swim. They'll have to take the fairy, Silvermist. She has a past with the Knave, as evidenced by the way she slaps his face. Nevertheless, Silvermist takes them across the lake despite her obviously unresolved feelings.
Cyrus lets a fellow prisoner know that the silver cage he's in is there to prevent him from escape. Silver and genies don't mix. Cyrus magically writes on a piece of paper with his finger. We jump back in to time to the day Cyrus gave Alice her three wishes. It was the day she freed the White Rabbit and walked off into Wonderland with Cyrus, who reveals that Jafar is after him. Cyrus also shows Alice his magic paper and teaches her how to fight with a sword. He's quite good, but Alice figures out his weakness. It's her. That's why Alice kisses Cyrus for the very first time.
Back in the present day, Silvermist drops Cyrus into the lake. It's payback for a broken heart. Alice has no choice but to jump in to save him. They land on an island that turns out to be a giant turtle. With a flick of her sword, Alice convinces the creature to take them where they want to go. Silvermist shows up again because she found out there's a bounty on the Knave's head. It seems he's in pretty deep to the caterpillar. Silvermist also mentions someone named Anastasia. She won't turn the Knave in, as she's moved by his speech about how it's more important for Alice to save her lost love.
The Red Queen grows bored by all the complaints of her townspeople. Suddenly, the bickering ceases as they are all rendered frozen. Jafar is behind this trick. He vaporizes the queen's townspeople so she can focus on the task at hand—finding the genie's bottle. Jafar wants to know its whereabouts. He freezes the queen to make his point. Then he frees her. The White Rabbit reveals the location of the bottle, as he gave the queen the details of what he had overheard.
In the past, Cyrus lets Alice know that he's fallen in love with her. She promises to not make her wishes so that they can be together forever. She asks him to trust her. This is the moment they decide to hide the bottle in the Mimsy Meadows. It's buried in the spot where Jafar is digging in the present day. Actually, that's not really true. Alice lets the Knave know that the bottle isn't there. It never was. She only said so in order to lure out those who also seek it. She wanted to know who they were up against. Now that she knows, Alice and the Knave can go to the place where the bottle is truly hidden. Unfortunately, someone has already dug it up. The only thing that's left is an empty hole.
Cyrus manages to stick his hand through the bars of his cage long enough to release the magic paper. It flies off to find Alice just as an angry Jafar returns. He wants to know where the bottle is. The Red Queen appears behind him to say she has it. She's just changed the game. When the queen returns home, the White Rabbit wants to be compensated for his services. The queen assures him that when she gets what she wants, he'll get what's coming to him. As for how the Red Queen got the genie's bottle, the White Rabbit saw Alice and Cyrus bury it in the past. That's how he knew where it truly was.