From the Super Mario Wiki
Mt. Rugged is a mountain that Mario, Goombario, Kooper and Bombette climb in Paper Mario. Mt. Rugged has a station where the K64 train from Toad Town stops frequently. This is where they meet Parakarry, the mail-delivering Paratroopa who later joins the party. They also have to face Buzzar, Bowser's minion. Buzzar won't let Mario and co. enter the Desert if Mario says his name is Mario or Peach, and Mario and company will have to fight him. He will let Mario and co. enter without a fight if Mario says his name is Luigi.
When Mario meets Parakarry, he tells them that he has lost letters all over the Mushroom Kingdom; several on Mt. Rugged. Mario must first locate Parakarry's three letters on Mt. Rugged before Parakarry will join his party. Mario needs Parakarry to hover across a broken bridge on the mountain, so he cannot progress until all three Parakarry's letters are located.
Mario also has the choice of battling Buzzar, which can help get him Star Points; alternately, he can tell Buzzar that he is Luigi, and Buzzar will surprisingly leave him alone.
Monty Moles are faced here on Mt. Rugged for the first time, and pop up out of nowhere in the mountainous dirt.
Mario can also find treasures hidden around on the mountain, often in small mountain balconies that waterfalls can loom over; he can find treasures down in lower areas of the mountain using Parakarry's gliding move as well.
An extraordinarily cheerful creature named "Whacka" is found on Mt. Rugged. When Whacka is hit with Mario's Hammer, an item appears from his head called Whacka's Bump, which could very well be one of the most useful items in the game. Eight of these can be gotten from Whacka until he disappears.
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