In 1977, 5-year-old Pete Healy [Oakes Fegley] is on a road trip with his parents when their car swerves to avoid a deer and overturns. Pete’s parents are killed in the accident, but he survives and is chased into the forest by a pack of wolves. Just when the danger seems overwhelming, a towering dragon with wings, green fur, and piercing yellow eyes appears and rescues him. Pete quickly forms a bond with the mysterious creature, and he names him Elliot after a character from his favorite book.
Six years later, in 1983, Pete notices a lumberjack crew cutting down trees near his home. Natalie, Oona Laurence, the daughter of foreman Jack Meacham Wes Bentley, spots Pete and gives chase. When she accidentally falls from a tree, her screams draw Jack and his girlfriend, park ranger Grace Meacham Bryce Dallas Howard. Pete tries to flee, but Gavin Karl Urban, Jack’s ruthless brother, knocks him unconscious. Realizing Pete has vanished, Elliot wanders the forest in search of him and ends up knocking over a tree near the lumber camp, prompting Gavin to organize a hunting party to track the boy down.
Meanwhile, Pete awakens in a local hospital, escapes, and desperately tries to return to the forest. Gavin and his men locate Pete and Elliot’s treehouse, but when they search it, Elliot reveals himself and frightens them away. He follows the men to town in an effort to locate Pete, and when he sees Pete settling in with Grace’s family, he leaves.
Pete shows Grace a drawing of Elliot, and she brings it to her father, Conrad Robert Redford, who says he discovered the same dragon when he was younger. Conrad urges Grace to trust Pete and to seek Elliot.
The next day, Pete, Grace, Natalie, and Conrad travel into the forest to meet the dragon. A group of hunters led by Gavin traps Elliot and tranquilizes him, locking him in Jack’s warehouse. Before authorities can inspect the dragon, Pete and Natalie free him and escape on a lumber truck with Conrad.
Angry and fixated on recapturing the dragon, Gavin sets up a roadblock at a bridge. Elliot attempts to fly, crashes into the truck, and the vehicle’s brakes fail, sending it through the barricade. The bridge buckles under a torrent of heat as Elliot, with Grace and Jack clinging to his back, carries them to safety in a ravine below. A firefighting helicopter hovers nearby as Pete, filled with resolve, flees back into the woods with Elliot.
Pete pleads with Elliot to let him stay and act as his protector, just as Elliot protected Pete. But Elliot reasons that their closeness will always put Pete in danger, and he points to Pete’s beloved book to encourage him to return to Grace and Jack. After an emotional, tearful goodbye, Elliot retreats to the mountains, and Pete returns to live with Grace and Jack as part of a new family.
In the years that follow, Grace and Jack marry and formally adopt Pete. Elliot gradually fades from the town’s memory, while Gavin has learned to temper his impulses and moves forward with a changed outlook. Pete and his new family eventually take a vacation and, in a poignant moment, glimpse Elliot reunite with his fellow dragons, now living alongside the ones who still guard the forest.
