On Earth, the Nasties find the Neverending Story and use it to bombard Fantasia with fireballs and a storm. The Nasties locate him, but he uses the book to escape to Fantasia, where he is reunited with Falkor, Engywook and Urgl. He later flees to the library, where he is surprised to find Carl Conrad Coreander and the Neverending Story.
Bastian arranges for them to be expelled with the help of the janitor after the Nasties trap him in the boiler room. Bastian has also started high school, where he has become a victim of the Nasties, a quintet of bullies led by Slip. Jane's daughter Nicole is displeased at having a new family. Bastian Balthazar Bux has grown older, and his father Barney has married a woman named Jane, and moved into her house in a new neighborhood.
