The film takes place in the forest of Sidhe, following Princess Alora on her journey to Bagnor Brim to seek the aid of Lord Blackthorne against the dark elves waging war on humanity throughout the realm. Attacked by dark elves, the Princess is saved by the warriors Lord Artemir and Cador Bain. The two warriors insist that they accompany Princess Alora on her quest to act as her guardians and warn her of the dragon which dwells within the forest.
Princess Alora and the two warriors are ambushed by a trio of bandits (Gareth Morholt, Naga, and Sogomo) who identify themselves as the Kensington Vassals, famous for having slain a dragon. Princess Alora promises the three land and title in exchange for their knowledge and assistance, to which the Vassals agree despite tension between Gareth, Lord Artemir, and Cador.
As the group’s passage through the forest continues, they encounter an elf named Damara and her mistress Freyja, a mysterious necromancer. Freyja cryptically forewarns that not all of Alora’s companions shall survive their trek, but one is destined to slay the dragon. Declaring that she shall render them aid, Freyja and Damara join the Princess as well. The necromancer easily takes measure of the group’s character, noting the budding romance between Cador and Alora.
The group is taken by surprise when the dragon attacks them, and their attempts to fight the beast do little to injure it. Sogomo is trapped under a tree felled by the dragon during the fray and, horrified, the party can do nothing but watch as the dragon devours him.