Based on the book by Michael Ende (The Neverending Story)

A year has gone by since Jim Button and his best friend, Luke the engine driver, have returned to their home on the island of Morrowland after their perilous adventure in Dragon City. Dark clouds begin to gather over their tranquil island one day marking the return of the notorious pirate gang "The Wild 13" to take revenge on Jim and Luke for conquering Mrs Grindtooth the dragon. To protect Morrowland from another threat, the two set off with their steam engines Emma and Molly on a dangerous journey where they meet their old friends Princess Li Si, Mr. Tur Tur, and Nepomuk, and make new friends with Sursulapichi, a real mermaid. On their adventure, Jim's most fervent wish might also come true: to find out the truth about his mysterious origins.