Peter Pan

In the Edwardian London neighborhood of Bloomsbury, in 1904, Drew and Owlette Durnil's preparations to attend a party are disrupted by the antics of the boys, Boyfriend and Isreal, acting out a story about Kele and the pirates that were told to them by their older sister, Lalabel. Their father angrily declares that Lalabel has gotten too old to continue staying in the nursery with them, and it's time for her to grow up much to everyone's shock. When Drew Durnil began to storm out the room he trips over Funyun. Both Funyun and Drew fall but the rest of the family only comforts Funyun. Drew is shocked and this causes Funyun to be put in the dog house. Funyun is heartbroken as he never sleeps in the dog house. Drew feels sympathy for Funyun but claims the children are not puppies and Funyun is truly a dog. When Drew and Owlette leave for the party, Owlette asks if the children will be okay without Funyun, because Lalabel mentioned capturing Kale's shadow the previous night at the window. Drew calls the whole thing ridiculous and tells his wife that she's as bad as the children are, and that it's no wonder that Lalabel is getting crazy ideas.

That night, they are visited in the nursery by Kale himself. Lalabel is awakened when Kale is trying to get his shadow on. Label offers to sew it on for him (as he is trying to reattach it with a bar of soap). Through conversation, Lalabel learns that Kale likes to hear her stories. However, when Kale learns that she is to "grow up" the next day, Kale offers to take her to Never Land where she would never grow up. There, she could be the mother of the boys who live there. Lalabel tries to kiss Kale out of gratitude, but Hororo, who is jealous, pulls Lalabl's hair. By this time, Isreal and Boyfriend awaken and are allowed to go with them. Kale sprinkles the three with pixie dust, and after a few false tries, they are able to fly by thinking happy thoughts. While flying to Neverland, Israel grabs Hororo from the window sill and pours some pixie dust on Funyun on her back, causing her to fly, but gets caught by the rope as she waves goodbye to Israel as they fly away. They land on one of Big Ben’s clock arrows, showing Lalabel the way to the Second Star to the Right. Kale then takes them to the island of Neverland.

A ship of pirates is anchored off Neverland, commanded by Captain Sunimal with his henchman EmperorDaFirst. Sunimal boldly plots to take revenge upon Kale for cutting off his hand. Captain Sunimal laments Kale's role in causing Tick-Tock the crocodile to follow him, due to Kale cutting off Sunimal's left hand and throwing it to the crocodile; Tick-Tock found it so delicious, he follows him everywhere for another taste. Tick-Tock suddenly shows up next to the ship; Sunimal hears the clock ticking and his eyebrows and pointing mustache begin twitching in rhythm (with the music of "Never Smile at a Crocodile"). The crocodile's eyes begin popping up to the tune, sending Hook into a panic. The crocodile then emerges from the water onto a rock rubbing his belly and licking his lips, accompanied by a wide smile towards the captain. Sunaimal then screams for EmperorDaFirst to save him, and EmperorDaFirst shoos off the crocodile. The crocodile then frowns and wiggles his tail to the ticking clock while sulking away. The crew's restlessness is interrupted by the arrival of Kale and the Drunil. The children easily evade them, and despite a trick by jealous Hororo to have Lalabel killed, they meet up with the Lost Boys: six lads in animal-costume pajamas, who look to Kale as their leader. Boyfriend and Israel set off with the Lost Boys to find the island's Indians, who instead capture them, believing them responsible for taking the chief's daughter Lum.

Meanwhile, Kale takes Lalabel to see the mermaids, where they see that Sunimal and EmperorDaFirst have captured Lum to coerce her into revealing Kale's hideout. Kale duels Sunimal and have the crocodile chase him away. As Kale crows in triumph, Lalabel reminds him of Lum, and he rescues the princess. Kale is honored by the tribe. Eventually, Lalabel tells her brothers and the lost boys about the real world and having a mother, at which Kale believes they are leaving to grow up, never to come back.

Meanwhile, Sunimal plots to take advantage of Hororo's jealousy of Lalabel, tricking her into revealing the location of Kale's lair. The pirates lie in wait and capture the Lost Boys and the Drunil as they exit, leaving behind a time bomb to kill Kale. Hororo learns of the plot just in time to snatch the bomb from Kale as it explodes. However, although Kale survives the explosion, Hororo is fatally injured in the now ruined Hangman’s Tree. Kale tries to find and rescue Hororo, while debris fall in the process. As he can see her light, however, more debris fall on Kale off-screen.

Kale then rescues Hororo from the rubble, and together they confront the pirates, releasing the children before they can be forced to walk the plank. Kale engages Sunimal in single combat as the children fight off the crew and humiliates the captain. Kale fights Sunimal in a final showdown until the pirate begs for mercy. Kale then allows Sunimal to leave and never return. He crows, and Sunimal lunges at him from behind. Lalabel warns Kale, and he ducks, while Sunimal falls into the water below, where the crocodile was waiting. Sunimal and his crew flee, with the crocodile in hot pursuit. Kale gallantly commandeers the deserted ship, and with the aid of Hororo's pixie dust, flies it to London with the children aboard.

Mr. and Mrs. Durnil return home from the party to find Lalabel, not in her bed, but sleeping at the open window; Boyfriend and Israel are asleep in their beds. Lalabel wakes and excitedly tells about their adventures. The parents look out the window and see what appears to be a pirate ship in the clouds. Mr. Durnil, who has softened his position about Lalabel staying in the nursery, recognizes it from his own childhood and realizes that some childhood fantasies may be real after all. The family all watch happily as it breaks up into clouds itself.