Barbie: A Fashion Fairy Tale is the third film since The Barbie Diaries where Barbie plays herself throughout the entire film and she goes on her own adventure; it also co-stars other dolls from the Barbie line-up. Barbie jets off to Paris to visit and help her fashion designer aunt, who is about to go out of business.

Merliah soon discovers a shocking family secret; she's a mermaid. Her mother is Calissa, the Queen of Oceana, but Calissa's evil sister Eris has stolen the throne. Along with her dolphin friend Zuma, Merliah sets off on an undersea adventure to rescue her mother and discover her true destiny. She must get three items to succeed: the hair comb, a dreamfish and Eris' protective necklace.