Once again, Bastian is transported to the world of Fantasia which he recently managed to save from destruction. However, the land is now being destroyed by an evil sorceress, Xayide, so he must join up with Atreyu and face the Emptiness once more.

Bastian is a young boy who lives a dreary life being tormented by school bullies. On one such occasion he escapes into a book shop where the old proprieter reveals an ancient story-book to him, which he is warned can be dangerous. Shortly after, he "borrows" the book and begins to read it in the school attic where he is drawn into the mythical land of Fantasia, which desperately needs a hero to save it from destruction.