Something Smells / Bossy Boots - S2-E1
Continuity mistake: When Spongebob is outside, and he takes out his "to do list" at first he is holding it with his right hand, but when it shows the front of the paper, you see that it is his left hand. Then it is his right hand again.
Sandy's Rocket / Squeaky Boots - S1-E8
Continuity mistake: When Pearl is opening her present the cake disappears.
Culture Shock / F.U.N. - S1-E10
Revealing mistake: In "Culture Shock" when Spongebob takes the green fish's order, he has a pencil tucked in his ear, but he doesn't have an ear, so it's just floating in thin air. (00:01:55)
The Sponge Who Could Fly (aka The Lost Episode) - S3-E16
Continuity mistake: On the news one fish had hair. Later it was gone.
No Free Rides / I'm Your Biggest Fanatic - S2-E10
Continuity mistake: After SpongeBob sees the "Queen Jellyfish" (really Kevin the sea-cucumber and his friends) he drops his jellyfish call out of his mouth. When it cuts to a wide shot, the jellyfish caller is nowhere to be seen.
Continuity mistake: In the scene where Mr. Krabs is saying "this is no game" Spongebob is in his underwear, then it goes to Mr. Krabs and back to Spongebob and he's in his work clothes.
Big Pink Loser / Bubble Buddy - S2-E3
Continuity mistake: It seems to me that half the cards that Spongebob used for the card snail have disappeared when Patrick comes in.
New Student Starfish / Clams - S3-E14
Continuity mistake: In the episode New Student Starfish., SpongeBob's good noodle stars changes number throughout the episode.
You Wish ('Shanghaied') / Gary Takes A Bath - S2-E11
Continuity mistake: After Squidward comments about how the ship is dirty, he continues to climb up the anchor rope. Once he's out of the shot, the rope immediately changes color.
The Chaperone / Employee of the Month - S1-E12
Continuity mistake: Spongebob says that this is the 27th award he has won, yet when he is standing in front of the pictures there are at least 30.
New Student Starfish / Clams - S3-E14
Continuity mistake: When SpongeBob and Patrick arrive to the class, SpongeBob writes Patrick's name in the board. Notice that he writes it in capital letters: "PATRICK". After, when Patrick is asked to say his name to the class, and he becomes nervous, look at the board, at Patrick's name: now isn't in capital letters, is normal: "Patrick".
Mermaid Man and Barnacle Boy III / Squirrel Jokes - S2-E4
Continuity mistake: In "Squirrel Jokes", when Spongebob tells the joke about Squirrel in the second act she's at a table alone, but in the next wider shot there's a chair next to her.
Your Shoe's Untied / Squid's Day Off - S2-E2
Continuity mistake: In Your Shoe's Untied, when Spongebob takes the patty to Squidward, it's just a patty with lettuce, but in one shot, you can see cheese and pickles on it.
Continuity mistake: In the morning when they all wonder where Santa is, and Spongebob keeps singing "Santa's coming tonight", once everybody walks away, Patrick appears right next to Spongebob.
Jellyfishing / Plankton! - S1-E3
Continuity mistake: Spongebob, controlled by Plankton, wasn't aiming directly at Squidward's house, but he eventually breaks through the wall.
Your Shoe's Untied / Squid's Day Off - S2-E2
Continuity mistake: In Squid's Day Off, when all of the coins go out of the cash register, you see 14 coins drop. When Squidward picks up the coins, there are only 12.
Nasty Patty / The Idiot Box - S3-E4
Continuity mistake: When Mr. Krabs tells Spongebob to make sure the health inspector's head sticking isn't showing, Spongebob's shovel disappears.
The Bully / Just One Bite - S2-E17
Continuity mistake: In "The Bully" SpongeBob accidentally runs into Flats' dad's car and there is only one seat. Later Flats is shown sitting in the car.
SpongeBob's House Party (aka Party Pooper Pants) - S3-E10
Continuity mistake: When Spongebob comes home from the police station in the morning, he gets the spare key from under the mat. That mat definitely wasn't there last night.
Hooky / Mermaid Man and Barnacle Boy II - S1-E20
Continuity mistake: Before SpongeBob takes off his pants, his pants are the only thing that is hooked to the fish hook. Later in the scene, his underwear is hooked as well.
Answer: I believe this is the Season 6 episode "Spongicus".