Prior to the game's start, Mr. Udderly was having a typical work day in the office sharpening pencils. When William the Kid's henchmen arrived to kidnap Mr. Udderly, they used the smell of feta cheese on their boots to hypnotize Mr. Udderly into placing himself into a "smelly dark bag". The henchmen would then take Mr. Udderly to Kid's secret island fortress.
While at Kid's lair, Mr. Udderly discovered that William the Kid plans to take over the entire dairy world with a five part master plan. While Kid's back was turned, Mr. Udderly stole the secret code that would turn the Milky Weapon of Destruction off, but he was forced to swallow the code before he could read it, so that neither Kid nor his henchmen would discover that he had it. Mr. Udderly was then left inside the N.O.G. Factory to be eaten by piranhas.
SPY Fox would later save him by freezing the tank, and lowering him down while the tank was frozen. Mr. Udderly is then taken to Spy Corps. Mobile Command Center, where he reveals William the Kid's five part master plan and that he has the secret code to destroy the Milky Weapon of Destruction. Unfortunately, he ate the code before he had a chance to read them, so that it wouldn't be discovered he had it.
Spy Fox must use his X-Ray Gum to look into Mr. Udderly's stomach to find the code. Due to Mr. Udderly's nervousness on pain overall, he gets dizzy and passes out when SPY Fox mentions he needs to use the X-Ray Gum to look for the codes inside his stomachs, giving SPY Fox enough time to find the code (which will say that SPY Fox must find a diode, key, or punchcard in order to disarm the Milky Weapon of Destruction). Mr. Udderly wakes up after SPY Fox finishes his business with the gum. SPY Fox may use the X-Ray Gum on Mr. Udderly on any point he wishes after that if the player forgets which, diode, key, or punchcard SPY Fox must get and use.
It is presumed that Mr. Udderly returned to work at Almagamated Moo Juice INC after the milk crisis was resolved.