The magical Peter Pan comes to the night nursery of the Darling children, Wendy, John and Michael. He teaches them to fly, then takes them through the sky to Never-Never Land, where they find Red Indians, Wolves, Mermaids and... Pirates.

The leader of the pirates is the sinister Captain Hook. His hand was bitten off by a crocodile, who, as Captain Hook explains `liked me arm so much that he has followed me ever since, licking his lips for the rest of me`. After lots of adventures, the story reaches its exciting climax as Peter, Wendy and the children do battle with Captain Hook and his band.