Scientist Mek tests his new trans-dimensional boat which transports him to another world. Kathy, on a camping trip with her family, finds Mek's boat and accidentally activates it, transporting them both to the land of the Spellbinders.
Kathy and Ashka are shocked to discover that the Dragon Lord is actually a young boy, Sun. While Ashka's power suit fails to impress him, Kathy gains favor by offering him chocolate. But they soon realize that he won't let them leave.
The Morgan family are reunited and together with Sun and Jasmine make their way to the palace, using Jasmine's dragon costume to get past the guards. Ashka sabotages the oracle and attempts to use Mek's boat to escape.
When Sun is caught outside the borders of his land by Sharak, Ashka uses her power suit to rescue him and instantly becomes his new favorite. Meanwhile, Carl refuses to believe that they are no longer in Australia.
With Ashka and the two Joshes trapped on Bain's yacht, Kathy turns to Carl for help, but runs into the other Kathy. Sun and Jasmine try to set an ambush to rescue Aya, but their plan fails when Sharack turns up.
Kathy escapes from Lem and Guin by pretending to be one of the robots and turns to Dr. Elvo for help, only to discover that he has imprisoned Mek and plans to use the two of them to repopulate the infertile world.
Sharak's men hold Vicky and Carl captive, while Josh plays on their superstitions to hide in the camp hoping for a chance to rescue them. Ashka uses Sun's love of chocolate to persuade him to travel with her to Kathy's world.
Josh evades Sharak's men by swimming across the river and on the other side he meets Jasmine who, confused by his wetsuit and flippers, believes him to be a water spirit and holds him captive to claim her three wishes.
Kathy turns to Tony to help track down the film company that stole the boat, and Sun gets a part in their latest commercial. Jasmine takes Josh back to her village, where the elders consider how they should use the remaining wishes.
Kathy and Sun return to Sun's world, but soon find themselves on the run from Ashka again. They arrive at Jasmine's village just in time to help Josh escape. Vicky and Carl finally catch sight of their children on the road to the palace.