From the Super Mario Wiki
The North Pole is a barren, icy region at the northernmost point of Mushroom World. Santa Claus, along with his Reindeer, Elves, and workshop, can all be found here. However, due to its cold climate, few people ever travel to the North Pole. King Koopa also owns an icy castle somewhere near the North Pole. Aside from Santa's property, the North Pole is desolate.
The North Pole is the setting of "Koopa Klaus". Initially, King Koopa has traveled to the North Pole shortly before Christmas, where he takes on the alter ego of Koopa Klaus and brings toys to his icy castle to be crushed before setting off to freeze Santa's workshop.
Mario and his friends wrongly arrived at the North Pole instead of Hawaii Land, due to the fact that Toad misleads them for the sole purpose of meeting Santa Claus. However, they soon learn that Koopa Klaus is planning to not only freeze Santa's workshop, but to kidnap the old man himself. They are too late to save the workshop from been frozen by Koopa Klaus' Ice Bombs, but they did not give up in their quest to save Santa.
After chasing Santa across several areas of the North Pole, Mario's group ultimately slid off a cliff and into a snowbank. Princess Toadstool tries to convince Koopa Klaus to rethink his intentions, but Koopa Klaus instead rants about his hatred of Christmas, which triggers an avalanche. Mario uses this opportunity to rescue Santa with his plumber's snake, while Koopa Klaus ends up on an iceberg with an angry Polar Bear.
Mario's group eventually returns Santa to his still-frozen workshop. However, the warmth of Toad's Christmas spirit melts all Koopa Klaus' ice, enabling Santa to make his deliveries.