Baabwaa is a sheep who loves to knit. Wooliam is a sheep who loves to read. It sounds a bit boring, but they like it. Then, quite unexpectedly, a third sheep shows up. A funny-looking sheep who wears a tattered wool coat and has long, dreadfully decaying teeth. Wooliam, being well-read, recognizes their new acquaintance: the Wolf in Sheep's Clothing! The wolf is so flattered to discover his literary reputation precedes him that he stops trying to eat Baabwaa and Wooliam. And a discovery by the sheep turns the encounter into an unexpected friendship.