Bennie, the cantankerous owner of Bennie's Junk ‘n' Stuff, is talking to his assistant. He tells the reluctant young man to set up traps around his property to protect against intruders, and though concerned about the danger, Hector dutifully obliges. Later that evening, Hector's fears turn out to be well-founded: an armed intruder sets off a trap, and ends up with a fatal gunshot to the chest.
While examining the crime scene the next day, Monk makes some important discoveries, and realizes that the intruder must have had an accomplice. Natalie also spots something of interest: a painting set, complete with a stack of blank canvases. Since Dr. Kroger had only that morning suggested that Monk pick up a new hobby, Natalie urges him to buy the paint set - and Bennie the Junkman makes an offer they can't refuse.
Monk has some trouble getting started with his new hobby, so Natalie signs him up for an art class at the local community college. Although his instructor and classmates aren't very impressed with his work, Monk begins to find his stride, painting the world as he wishes it looked, complete with perfectly round clouds and perfectly straight bananas.
Soon, the budding artist is called back to the junkyard, this time to investigate a new crime. Bennie the Junkman has been found dead, apparently the victim of one of his own traps. But Monk realizes that not all is as it seems; Bennie's death wasn't accidental. Someone else, most likely the accomplice from the earlier crime, had broken into the junkyard and killed Bennie. Clearly there was something of value buried amongst the piles of junk - but what could it have possibly been? The answer could lie in Bennie's logbook, in which he kept a record of the items that came in and out of his junkyard. When Monk notices that the last page of the book has been ripped out, Captain Stottlemeyer and Lieutenant Disher set out to find Hector, in the hopes that he might be able to fill in the missing pieces.
Back at his apartment, Monk is paid a visit by a stranger. Petya Lovak introduces himself as a Russian art dealer and a passionate admirer of Monk's work. He backs up the claim by buying Monk's two finished paintings on the spot, promising to return soon for Monk's new work, and urging Monk to keep at it.
It's advice Monk takes to heart, and soon he has also taken over Natalie's living room in pursuit of his art. Stottlemeyer and Disher are baffled by Monk's work, and shocked that he seems to be blowing off the investigation to work on the paintings. When Lovak shows up and buys two more paintings - and even tries to buy a hideous portrait of Natalie - they grow more bewildered. Is it possible that Monk actually be a good artist? Lovak sure seems to think so. He soon turns up again, this time at the community college's art show. Lovak ignores the work by other artists, but buys more of Monk's paintings - again, all except the portrait of Natalie, which she refuses to sell because it had been a gift from Monk.
As Monk is embracing his inner Picasso, Stottlemeyer and Disher finally get a lead on the murders at the junkyard. Hector leads them to a home where he and Bennie had found some canvases and other art supplies sitting on the curb. Stottlemeyer makes an important discovery when he learns that the canvases had belonged to an employee of a paper company that manufactured paper for the U.S. Treasury, and that the recently deceased man had also sold his mediocre paintings to a mysterious Russian art collector.
At the art show, Monk begins to have his own suspicions that something is not right. He had seen a painting in Lovak's van that he remembers having seen somewhere else before - at the junkyard. He realizes it must have been stolen from the junkyard on the night Bennie was killed. Stottlemeyer and Disher soon arrive and fill in the missing pieces: Lovak is a Russian mobster who had been working on a counterfeiting scheme with the paper company employee, and they had smuggled the paper by disguising it as art canvases. Lovak has been buying up Monk's art because the paper is worth hundreds of thousands of dollars, and Lovak is willing to do anything to get it.
This means trouble for Natalie, who has returned home with her portrait and is once again visited by Lovak. When she continues to hold out Lovak turns violent, but luckily Monk, the Captain and Disher arrive in time to lure Lovak out of the house by setting his canvases on fire. Monk's precious artwork ends up going up in smoke, and with it his short-lived painting hobby, allowing Monk to get back to what he does best: solving crimes.