Twilight Sparkle is still fretting about her recent coronation to a princess (in Magical Mystery Cure) as she and her Ponyville friends travel to the Crystal Empire for a celebration. While there, Sunset Shimmer, a former and bitter student of Princess Celestia, steals Twilight's crown, one of the Elements of Harmony. In the tussle, the crown falls through a magic mirror, and Sunset follows it through. Princess Celestia informs Twilight and her friends that the mirror leads to a different world and that Twilight alone must cross over to retrieve it, else the Elements of Harmony will fail to work to protect Equestria. As Twilight crosses over, Spike jumps in after her.
The two find themselves in a different world outside of a large school; Twilight has become a teenaged human girl, while Spike has become a dog. The two are confused about this new world, but Twilight starts to recognize several of the schoolmates as similar to her Ponyville friends - Applejack, Fluttershy, Pinkie Pie, Rainbow Dash, and Rarity - and quickly befriends them. Meanwhile, she discovers that Fluttershy has found the crown and turned it over to Principal Celestia, much to Sunset Shimmer's annoyance. Principal Celestia, unaware of the power of the crown, deems it the prize for the upcoming Fall Formal, and Twilight decides she must vie for Sunset to win Princess of the Fall Formal to gain the crown. She meets Flash Sentry, Sunset's former boyfriend, who opts to help her along with her new friends to win the Formal. Sunset tries many ways to humiliate Twilight, such as releasing videos of Twilight struggling to get used to the human world, but her friends help to counter these ploys and help improve her popularity.

At the Formal, Twilight is named the Princess and given the crown, but Sunset steals it with the help of two other students, Snips and Snails. When Sunset dons the crown, she transforms into a demon-like creature and quickly uses her newfound powers to brainwash the other students at the school, including Flash Sentry. Twilight and her five new friends are able to recover the crown, but Sunset remains as a demon. Twilight is able to evoke the Element's power, temporarily transforming the six into pony-like humans and wielding a power through their friendship that is able to excise the demonic form from Sunset and revert the rest of the students to normal. As everyone recovers, a repentant Sunset asks for forgiveness, and Twilight asks her friends to become Sunset's new friends, something she hasn't had before. Then the principal of Canterlot High, a human version of Princess Celestia, gives the crown to Twilight. After the Formal, Twilight and Spike say their goodbyes. After talking to the 6 human versions of her friends, the vice principal, a human version of Princess Luna, gives her a tool to rebuild all the destruction she had caused. Finally, Twilight and Spike return to Equestria with the crown. Twilight is relieved to be back in her own world and with her friends, and less reluctant about her royal duties.