The player plays as Jigglypuff against three other Jigglypuff on the Pokémon Stadium stage. The player must KO the three other Jigglypuff to win.
If the player uses Sing on this stage while the screen in the background of Pokémon Stadium is focused around your Jigglypuff, all three of the other Jigglypuff on the ground will fall asleep, and for much longer than they usually would. This easter egg is known as "sleepy time". The effect is not unlike Peach Blossom, Peach's Final Smash in Super Smash Bros. Brawl.
It is possible that the number of this event refers to Jigglypuff's number in the National Dex in the Pokémon games: #039.