Elinor \"Nory\" Boxwood-Horace and Reina Carvajal discover they possess magical powers: Nory can transform into animals, and Reina can control fire. They enroll at Sage Academy, a prestigious magic school.
At Sage Academy, students are sorted into specialized classes that match their abilities: the Flare class for fire users, the Fluxer class for those who turn into animals, the Flyer class for short-distance flight, the Fuzzy class for those who can talk to animals, and the Flicker class for levitation. The two friends must prove themselves worthy of the honors tracks by testing their powers, all while living under the school’s rules known as the Sage Way.
During the entrance tests, Reina demonstrates her flare powers while Nory, in an attempt to become a cat, inadvertently morphs into a cat/dragon hybrid. Reina is placed in the Honors Flare class, but Nory is assigned to the Upside-Down Magic (UDM) program—a setback that worries Headmistress Knightslinger. The headmistress fears that UDMs could be easy targets for Shadow Magic, an evil force that can turn a person’s magic against others. Three other students also struggle on their tests: Elliot, an upside-down Flare; Pepper, an upside-down Flicker; and Andres, an upside-down Flyer.
As Nory and the other UDM students secretly work to improve their abilities, Budd Skriff quietly lends his support. Budd, played by a teacher in the making, helps them while keeping Headmistress Knightslinger from discovering their efforts.
The tension rises when Reina discovers a book about Shadow Magic and brings it to the dorm. Unaware of the Shadow Magic legend the UDMs were taught, she seeks guidance and even debates with a wary friend, Chandra. Chandra, who knows more than she should, takes the book but it keeps returning to Reina’s room. It is revealed the next day that Chandra is an embodiment of Shadow Magic in human form, and she can manipulate Reina without most people noticing. Chandra’s actions grow more alarming as she appears to possess unusual knowledge about the book’s power.
Meanwhile, Budd reveals a surprising truth to the UDMs: he is an upside-down Fuzzy (he can sing to animals but cannot talk to them). Rather than chasing perfection, he decides to help the UDMs gain better control over their powers.
Founders’ Day arrives with high stakes. Reina represents the Flares and, during a complex Flare display, becomes a shadow-like being that threatens to obliterate the school. The UDMs must act, and they do—rescued by Nory and the other UDMs, Reina is returned to a stable state just long enough to help defeat Shadow Magic. In the aftermath, Nory and the UDMs are moved into their own distinct magic tracks, Budd is reassigned as an official Fuzzy teacher, and the Sage Way is abolished, allowing students to pursue their own paths.
In a pre-credit moment, the Shadow Magic book falls from a shelf and opens to a page that shows a symbol removed from the normal magic logo, hinting that Shadow Magic may not be fully defeated and could reemerge with destructive intent.
