While playing in the woods, the Pocket Dragons encounter a number of small animals that have been turned to stone by a Basilisk - which soon turns Cuddles and Specs to stone, too! The Basilisk, whose name is Jewel, is turning animals into stone decorations for the castle of the vain and pompous Duke Drake, who is holding Jewel's young son hostage...

The Pocket Dragons (a group of very small dragons) live with a kindly old wizard, and their many adventures.

Zoom Zoom refuses to accept the fact that Pocket Dragon can't fly: he's sure that he's destined to be "first in flight." When Scribbles tries to help him with her latest invention, it leads all the Pocket Dragons to a perilous ride in a makeshift flying machine, where they must escape from a monstrous flying creature and find a way to make it home in one piece...

The Wizard brings home a friendly gnome named Gnorman to play with the Pocket Dragons while the Wizard searches for Gnorman’s missing family. But as soon as the Wizard is gone, Gnorman turns out to be “gnotoriously gnasty,” tormenting the Pocket Dragons for fun. To make matters worse, the rest of Gnorman’s family soon arrives, and they take over the castle! The Pocket Dragons must evict Gnorman and family from the castle, and give the Gnomes a taste of their own medicine.

When Specs meets the village’s beautiful new librarian, Princess Betty Bye Bell, he’s immediately smitten. To try to impress her, Specs and the other Pocket Dragons pretend to be a human-sized wizard, so Specs can bring the Princess flowers. The charade goes awry, however, when they run afoul of an ill-tempered sorcerer named Shmahz, who takes offense at the Pocket Dragons’ “wizard” and challenges them to a magical duel!

The Wizard receives a mysterious package from an old friend, containing a strange magical artifact: a star that can grant any wish! The Pocket Dragons immediately start making wishes, but quickly get more than they bargained for. The Pocket Dragons must work together to stop the star before their out of control wishes destroy the castle and level the entire village...