Directed by: Pamela Fryman

Guest Cast: None this episode.

Guest Callers: None this episode.

Skyline: The Space Needle is decorated with Christmas lights.

Plot: Daphne has found out about Niles' feelings for her and is confused. When she turns to Roz for advice, she finds out everyone knew except her. Roz says that Niles is over her because he has Mel now.

Niles meanwhile has to see Maris. Yoshi, the gardener has died and she wants him to comfort her. Frasier advises him not to tell Mel this in case she jumps to conclusions. Frasier meanwhile is planning his party for Roz and the other people in the building.

At the KACL party, Frasier tries to keep his party secret as no-one from the station has been invited. Mel, who had done a guest spot on KACL's health show, arrives and asks Frasier about his and Niles' dinner last night (Niles' cover story). Frasier accidentally uncovers the lie by saying about his party, and Mel confronts Niles. He says he was buying her present, but once again Frasier puts his foot in it. Mel storms off, followed by Niles, who loudly tells everyone else about Frasier's party.

At Frasier's party, no-one has arrived. It seems that Cam Winston, the guy upstairs has held a rival party and everyone has gone there instead. All Frasier has is Martin, Roz, Niles, Daphne and Donny. Niles accidentally drops Daphne's present and it breaks. Martin suggests he gives her Mel's present, and he does. Later on Mel calls and Niles explains about Yoshi. Mel comes to the party, and so Niles needs her present back. He speaks to Daphne, who thinks he's going to say he loves her.....

Subtitles: Anyone For A Hot Buttered Margarita?; Come A Wassailing To Frasier Crane's Holiday Fest Elliot Bay Towers #1901 Regrets Only.