Puss accompanies Shrek and Donkey to find the Fairy Godmother's office and helps the duo steal a potion called "Happily Ever After".When he offered to sample the potion for Shrek, Donkey interrupted him, saying it was "the best friend's job" and drinks a small amount of the potion.Then, Donkey accidentally gets hit by fairy dust from a fairy, (which Peter Pan was taking in to sell) making him fly.He exposed himself by talking while flying, but after the few seconds of him flying, it was over and he hit the ground.Donkey is first seen with an old lady who was his owner and the two of them, along with other characters, were in a line for people who had fairy tale creatures and they exchange the creatures for money.When she was there, Donkey refused to talk and the knights took her away.He pleaded for their forgiveness, but Donkey is upset when Shrek forgives him.
Then, at night, Shrek found many other fairy tale creatures outside his house (besides Donkey).
But at that moment Shrek fell down and got his behind kissed instead.
She tried to give chase but failed, if Donkey wouldn't have been rescued Dragon would have likely kept him there forever where she could have kissed him as much as she pleased.
The knights tackled him, but he was still able to escape from them fast enough and literally bumped into Shrek.
Shrek scared the knights away by posing as the giant, and after that, Donkey wanted to be Shrek's friend to repay him.