One night we see that a woman is carrying her child in the empty streets of London. After a while she finds herself in front of a local orphanage. There she leaves her small baby on the doorstep of the orphanage.
The story then jumps forward by 12 years and it introduces us to Peter. He is 12 years old and lives in a very crowded boys orphanage. He was abandoned as a small child and since then his only family has been the other orphan boys and the horrible nuns who run the entire orphanage. Peter likes to get into trouble a lot, he often pulls pranks on the nuns and is very mischievous. His main target is the head nun. Peter hates her so much and he thinks that she is the reason why everything is so horrible in the orphanage. She is cruel, strict and downright annoying. Peter and his best friend Nibs talk about her during lunch. They also notice that each day more orphans disappear from the orphanage without explanation.
Peter thinks that the head nun is responsible for the orphans going missing and he also has a theory that she is keeping all the good food for herself and her employees while the children starve.
One day during an air raid of war planes, the entire orphanage is evacuated. All the orphans and the nuns must take shelter in a safe house. Meanwhile Peter and his friend Nibs hide and stay behind. Soon after that they find their way to the head nuns main office. Peter thinks that she is most definitely hiding some food there. The two boys start to explore the office and outside the head nun notices that Peter is missing. She knows that he is up to something as he is the main troublemaker.
Peter then spots a statue of Virgin Mary. He starts to play around with it and by accident he opens a trap door and Nibs falls in. Peter and Nibs then discover that their theory was correct, the head nun has a bunch of food and supplies in her secret room. The two of them start to explore and soon enough they find a bunch of letters and lists of orphans.
They find records showing that 34 orphans have gone missing and soon enough Nibs finds one of the records that is talking about Peter. They uncover a letter written by his mother. Peter gets emotional as Nibs reveals that Peter’s mother loved him very much. Just as they are about to finish the letter loud gunshots and blasts are heard. The head nun has found them and they are about to be punished. The head nun insults Peter and tells him taht he is not special at all and nobody cares about him. She then gives really difficult chores to Peter and Nibs as punishment.
Peter and Nibs are now convinced that the nun has been selling the orphans and that is why she has so much food. All the orphans disappear during the night and Peter thinks that the same could happen to them at some point. Well that happens even sooner than Peter expected, that same night the nun hoists a giant pirate flag on the orphanage. Then suddenly from the roof pirates burst in and start kidnapping children. The pirates are ruthless and they take away everyone. Nible gets taken away and he screams as the pirate pulls him in the air. Peter lands on the floor and tries to remain unseen beneath the beds. He then finally sees the exit and runs for it. There the head nun awaits him and punches him into the hands of the pirates. Peter and Nible are now on a giant flying pirate ship. They are joined by many of the kidnapped orphan boys and also the ruthless pirate crew. Nible sees that the roof of the orphanage is still nearby so he jumps off the ship onto the roof. Peter is just too scared of heights so he is unfortunately taken away and separated from his friend.
In the same time the Nazi air force is attacking London. Nearby fighter jets notice a giant pirate ship flying around. They try to fire on it but the pirate ship is just too fast for them. Soon enough the pirate ship flies high into the sky and it leaves our dimension. We see it leave for space and there Peter and the rest of the crew float as there is no gravity. Suddenly they enter a totally new dimension.
This dimension has a very magical island, its called Neverland. Peter notices how everything is totally different from London. There are flying oceans and strange creatures everywhere. He also sees a vicious alligator that scares him.
Soon enough the pirate ship arrives at a giant mining prison. There Peter finds himself in the company of countless other orphan boys. All of those children have been kidnapped over the years and now they work as miners for fairy dust. The imprisoned workers start to celebrate the new arrivals and that is where Peter is introduced to the fierce Blackbeard. He is the main leader of this entire operation and the most horrific pirate. Everybody is afraid of Blackbeard and its obvious that he is not a sane person. Blackbeard welcomes the new workers to his mining operation. Blackbeard then reads the rules, you have to work hard to be rewarded and if you fail, you will be punished.
Peter starts to work that very same day. He is now a miner and the work is hard. There are orphans of all ages and races at the mines. Peter is very curious about this entire new world. He gets to talking with one of the pirates. Peter still cannot believe that magical creatures like fairies are actually real in this world.
Peter also meets an older miner, he is a bit brash and cold towards Peter. This miner tells Peter that he needs to work and not ask so many questions as this is a very place. Later in the day he starts to spend time with the unfriendly minor. Peter has a lot of questions for him but does not get any clear answers. This miner helps sharpen Peter’s pick axe and explains that he has been working at the mines for 14 years. He does not want to spend any more time with Peter and tells him that they are not friends and he should get lost.
Peter continues his work at the mine. After a hard day of mining he manages to finally find a fairy dust rock. He is so happy and proud of himself. Another miner arrives and takes the rock for himself. This miner brags that he in fact was the one who found the rock. Peter starts to protest and gets into a fight. He is now captured and is prepared to be punished with other workers. Before the ceremony of execution we see Blackbeard talking with one of his pirates. Blackbeard is furious as the savage natives of Neverland have been attacking his ships for far too long. He knows that there is barely any fairy dust in the mines and wants the savages defeated and to claim their land for himself. After that Blackbeard goes outside to punish the orphans who have misbehaved. All of them are forced to walk a plank on a ship high in the sky.
Blackbeard is very ruthless and he ask all the other minors to decide if Peter and other kids will be punished. All the minors vote that they should die so Blackbeard’s starts kicking kids off the plank. Soon he arrives to face against Peter. Peter still tries to explain that he is innocent but Blackbeard does not listen. Peter is kicked off the plank and he falls down to the pit.
Suddenly Peter starts to float. All the minors are surprised and nobody can believe what just happened. Peter is so happy that he is alive and also that he can fly. As soon as he starts to celebrate his new powers go away and he falls down. After a while he wakes up in Blackbeard’s room on the ship. Blackbeard soon appears and he seems to be much nicer than before. He talks with Peter in a calm voice and explains the entire situation.
Blackbeard wants to connect with Peter so he gives him some chocolate. He then explains that Peter is very special and that he thinks he is part of an ancient prophecy. In the ancient past the fairy kingdom was the main force in Neverland. Their prophecy said that a boy would disappear from Neverland and then return when he is old enough. This boy is very special and he will lead the revolution that will end the reign of Blackbeard and his pirates. This special boy will be able to fly.
Peter thinks that this story is too crazy and he does not fancy himself as someone special. Peter tells Blackbeard that he does not want to cause any problems and that he will not start any revolutions. For a moment Blackbeard seemingly believes Peter but still decides to lock him up in a prison cell.
The minor that Peter met before realizes that Peter might be his ticket out of the cursed mines. He blows up the walls of the prison and sets Peter free but only on one condition: Peter has to help this minor escape. Finally the minor reveals that his real name is James Hook and that he is a good guy who just wants to be free. He is an orphan, the same as Peter and he just wants his freedom from Blackbeard.
The two of them manage a daring escape and also get the help of another minor called Mr. Smee. They finally find a very old pirate ship called The Jolly Roger. They jump on the ship and fly away, escaping the rest of the pirate slavers. Their next goal is to find the tribe of the Neverland natives and get their help. Soon the natives actually capture Peter and his new crew. The leader of the natives is a woman called Tiger Lily and the natives now want to test Hook and someone called Pan. This Pan is the greatest warrior in their tribe. James and Pan start their fight and James barely survives. After the fight the tribe members realize that Peter can fly and he also has a special necklace. This is the same necklace that was given to him by his mother before she left him. In actuality this necklace is called the Pan.
The natives give Peter 3 days to train and prepare for his final test. He will either master the ability of flight or he will die. Peter starts to train and spend time with the natives. On the second day of training the pirates arrive and start attacking the camp. Mr Smee is actually a traitor and in the pirate attack Tiger Lily’s father is killed. He was the chief of the tribe and before his death he reveals to Peter that his mother was killed by Blackbeard.
Peter, James Hook and Tiger Lily are the only ones that escaped the pirate attack. They decide to travel to a place called Mermaid Lagoon. This is the safest place for them to hide and there James finds another flying ship. James decides that he will leave Neverland with the flying ship. Tiger Lily gets angry at him and calls him a coward. Peter decides that he will stay with Tiger Lily and try to defeat Blackbeard.
While that is happening we see that Blackbeard has found more fairies and using the fairy dust he has made himself live longer. Blackbeard then leads his pirates to the fairy land and after stealing Peter’s necklace he unlocks the land of the fairies and their powers.
Tiger Lily and Peter are captured by Blackbeard’s men. While captured they meet Tinker Bell, a fairy who tells him to hide from Blackbeard. Blackbeard is totally out of control and starts to burn the fairies. Suddenly James Hook arrives on the Jolly Roger and starts a giant battle with the pirate ships. Peter finally masters his powers and starts to fly. James Hook falls off the ledge and Peter flies in and saves him. Peter also saves Tiger Lily from certain death. During the battle Blackbeard also fell over the edge and it finally seems that he has died.
After the giant battle is over Peter goes back to his orphanage and there he offers some of the orphan boys to join his squad and that they can have many adventures in Neverland. This group of orphans is led by Peter and they are called the Lost Boys.
James Hook and Peter are now great friends and Hook has begun a romance with Tiger Lily. They fly on a pirate ship towards their new adventure.