Wendy, Michael, and John are three children living in London. They relish retelling and reenacting the adventures of Peter Pan, a brave, handsome, mischievous boy who lives in Neverland and will never grow up. Their father thinks it is pure nonsense. In his opinion, Wendy needs to stop believing in childish fairy tales. He pronounces that this night will be her last night in the nursery with her two younger brothers and her nursemaid Nana (who is a dog). On this critical night, Peter Pan and his love-stricken fairy Tinkerbell fly in through the window, looking for Peter's lost shadow. Wendy helps to sew it on and Peter grows fond of her, offering to take her back to Neverland to be the mother to all his friends, The Lost Boys. She will take care of them and tell them stories. They accompany Peter Pan back to Neverland and see his world firsthand, including the beautiful but jealous mermaids in Mermaid Lagoon, the dastardly villain Captain Hook and his assistant Smee, and the neighboring Indian tribe and the chief's beautiful daughter Tiger Lily.