Bastian's Mother is in a car accident. Bastian then meets Mr. Coreander, the owner of an old book store. Mr. C gives Bastian a book called The Neverending Story in exchange for a broken video game. Bastian's mother tells him that the book will guide him. Later, he wakes up and his mom is gone. He attends her funeral and has a hard time coping with her death. He begins reading TNES and becomes involved with the characters and events that occur in a mystical land known as Fantasia. He discovers that the land is in grave danger and his being ripped to shreds by dark force known only as ""The Nothing"". The Childlike Empress of Fantasia chooses a young warrior known as Atreyu(son of all) to combat the nothing to and to find a cure for her illness which seems to coincide with the poisoning of the land.

Mr. Blank (Bastian's teacher) claims that Bastian never handed in an assignment. Now Bastian has to redo the assignment during lunchbreak.

Atreyu begins his quest against the darkness.

Bastian is so caught up with the book that he neglects his school work and his chores around the house. In Fantasia, Atreyu meets Fly Girl and finds out the luckdragon is a flying machine flown by Fly Girl.

When Bastian learns that nothing in Fantasia can exist without a name, he enlists Marley and Lucas to help him get rid of Mr. Blank by deleting all references to him in the school. Meanwhile, Atreyu joins up with Fly Girl and heads to the Southern Oracle

Bastian is worried about a girl in his class: Fallon. His concern grows when he sees her wearing an old coat of his mothers that he and his dad donate to the poor.

Connor, a bully in Bastian's class challenges Bastian to a fight and bastian decides to accept the challenge. Moonchild sends Fly Girl on a solo mission and takes back the aurin from Atreyu and gives him a rusty old sword which if he says the name of it, it'll become of use to him. Atreyu meets with the woodlanders and 3 fallen heroes.

Because of the fight between Bastian and Connor both are put on detention for a week. During the week, Miss Vinagan tells them to write a compostion on any subject so Bastian decides to write about the book but when bastian and Connor re-write the story, the events change in Fantasia to what they write.

In Fantasia, the 3 heroes lock up Atreyu and Tartis but they eventually get out and Atreyu battles Xayide's knights.