Act 1
At the Darling family home in London, young Wendy dances in her bedroom with Nana, the faithful family dog. Her brothers John and Michael arrive and join in the fun. Mrs. Darling and Liza the maid enter to ready the children for bed. Mr. Darling arrives and is worried about being late for a dinner party. After the boys pretend to be pirates and kidnap Father, the playful children foil all of Mother’s attempts to get them into bed and convince their parents to tell them a story. Finally, peace is achieved and with the children drifting off to sleep, Mother and Father leave for the dinner party.

When the coast is clear, Tinker Bell enters the nursery in search of Peter’s shadow, which he lost while listening at the window to Wendy telling stories to the boys. After madly searching the room, she finally finds it in the washstand. Peter enters and tries frantically to catch his shadow. Unable to do so, he slumps down beside Wendy’s bed and begins to cry.

Wendy awakens to see Peter crying and offers to sew his shadow back on. She is quite taken with Peter and seems to have a vague recollection of him. She offers him a kiss and when he doesn’t know what that is, gives him a thimble. Peter invites Wendy to Neverland where she can be the mother and tell stories to the Lost Boys. Meanwhile Tinker Bell is very jealous and upset at Peter’s attention to Wendy. After accepting Peter’s invitation, Wendy wakens John and Michael who are overjoyed to see Peter and Tinker Bell in the nursery. All three children have a quick flying lesson and with the help of Tinker Bell’s fairy dust, take off through the nursery window. After flying over London, they are off to adventures in Neverland – second to the right and then straight on till morning!

In Neverland, Tiger Lily, the Fairies, and the Crocodile are in the lagoon when they hear the pirates coming and quickly hide. Smee tells Captain Hook that Peter has returned to the island with new treasures when suddenly the Crocodile appears and tries to get another taste of Hook. Peter brings the children to the Fairy Forest where all of the sprites dance in celebration. The Lost Boys arrive and everyone is happy that Peter has returned to Neverland. The merriment does not last long when the Pirates challenge Peter and the boys to a fight. Dueling with Hook, Peter is almost defeated, when just in the nick of time the Crocodile chases away Hook.

Act 2
In London, Mr. Darling and Liza try to console Mrs. Darling who is heartbroken over the disappearance of the children. Meanwhile in Neverland, Wendy has settled into the role of Mother to the Lost Boys. When Peter goes to check on the island, Wendy and Tinker Bell give the boys their medicine and tuck everyone into bed for the night, unaware of the adventure just ahead. The Pirates enter the underground home and capture all the children. Only Tinker Bell escapes! Captain Hook, disappointed in not finding Peter, poisons the medicine bottle in hopes that he will drink from it when he returns.

Later, as Peter gathers his sword and his courage before heading out to save the children, he remembers to take his medicine. But before he can, Tinker Bell drinks it herself to save Peter’s life. Tinker Bell begins to fade despite Peter’s attempt to revive her. She slips away and only the Fairies are able to revive her by dancing until she is magically resurrected. On the pirate ship the new “recruits” are put to work. Peter flies to the ship and after a fierce battle, defeats Captain Hook and the Pirates.

After celebrating their victory, Peter begrudgingly agrees to take Wendy, John, and Michael home. Wendy is worried that her brothers are forgetting their real parents. The Fairies fly the ship home, where the children surprise Mrs. Darling in the nursery. Mr. Darling, Nana, and Liza hear the commotion and rush in where they are introduced to the Lost Boys who have decided it is time to grow up.

After the others leave the nursery, Wendy returns, having sensed that Peter is still nearby. He has been waiting outside the window. After a tender moment, with Peter promising to return, Wendy watches him fly off into the stars, and on to another adventure!