A group of teens face their fears in order to save their lives.
In the small town of Mill Valley, friends Stella, Auggie, and Chuck, plus drifter Ramon, come across the haunted home of the Bellows family, whose adult daughter Sarah was said to have poisoned neighborhood children. The friends find Sarah’s old book of scary stories, unaware that the stories write themselves and come to life. The first story brings to life a scarecrow named Harold, who goes after bully Tommy and turns him into a scarecrow.
Auggie is taken by a monster whose big toe was cooked into a stew that he ate. Chuck’s sister Ruth is attacked by a swarm of spiders emerging from her cheek, but he, Stella, and Ramon save Ruth before she is taken.
The friends learn that Sarah was innocent and framed by her own family, who were the ones poisoning kids with the water supply. Chuck is then stalked by a pale woman and absorbed by her. Stella and Ramon are taken into custody over the disappearances, but Chief Turner is killed by the Jangly Man. Stella and Ramon escape him and run back to the Bellows home, where Jangly Man follows to get Ramon, while Stella encounters Sarah’s ghost. Stella tells Sarah she knows the truth about her and promises to let others know the real story. After writing it in the book to confirm, Sarah’s ghost crosses over.
Ramon willingly goes to Vietnam for the draft, but Stella promises to keep in touch with him. After publishing the story about Sarah, she teams up with her father and Ruth to use the book and find a way to bring back Auggie and Chuck.
On Halloween night in 1968, three teenagers in the small town of Mill Valley, Pennsylvania—horror-obsessed amateur writer Stella and her friends Auggie and Chuck—play a prank on school bully Tommy Milner and evade him with the help of drifter Ramon. The group decides to explore a local haunted house which belonged to the Bellows family who helped found the town. Inside, they find a secret room and a book of scary stories belonging to Sarah Bellows, who has been removed from all family photographs. Tommy tracks them down and locks them in the room along with his girlfriend who is Chuck’s sister Ruth. After Tommy leaves, they are released by an unseen presence and escape.
In her room, Stella discovers that a new story entitled “Harold” is being written in the book and the main character is Tommy. Meanwhile, Tommy is stalked by a scarecrow called Harold in a cornfield and is stabbed by the creature with a pitchfork before vomiting hay and seemingly transforming. Unsettled, Stella and Ramon investigate and find a scarecrow wearing Tommy’s clothes and with similar hair. Although Stella is convinced that Tommy has been turned into a scarecrow, the others are skeptical, especially Ramon, who fears the police will see him as a suspect in the disappearance due to his earlier altercation with Tommy.
That night, Stella and Ramon witness a new story being written titled “The Big Toe” with Auggie as the main character. The pair attempt to warn him of the threat—a living corpse looking for its missing toe which is inside a stew that Auggie unwittingly eats. Auggie flees, pursued by the corpse, and hides in his room but is attacked by it and dragged under his bed, disappearing. Terrified and realizing they are next, the group try and fail to destroy the book before deciding to research into Sarah Bellows’s past to find any way to stop the hauntings. Meanwhile, Ruth discovers a spider bite on her cheek and as she goes to the school bathroom to inspect it, a new story with her as the main character is written: “The Red Spot”. The group race to warn her and find her just as the spot explodes and releases hundreds of spiders, quickly covering Ruth. The others manage to find her and get rid of the spiders. Ruth is taken to the hospital, badly traumatized but alive.
The group’s investigations take them to a hospital where they discover Sarah’s own brother Ephraim was performing electroshock therapy on Sarah to hide the fact that the family’s mill had been poisoning the town’s water with mercury, killing children. Chuck is separated from Stella and Ramon and is confronted by “The Pale Lady”, a phantom from his recurring nightmares. The entity appears all around him and pulls him inside her. Stella and Ramon find Chuck’s pen as the only thing left of him before they are found by hospital orderlies and arrested by Police Chief Turner who reveals that Ramon is a draft dodger. In their cells that night, Ramon reveals he skipped the draft as his brother was sent home “in pieces” and he was scared of serving. Turner’s dog begins to act strangely and Ramon realizes the next creature will be The Jangly Man, a monster from a campfire story (“Me Tie Dough-ty Walker”) that scared him.
The Jangly Man, able to build itself up from body parts, appears, shouts “Me tie dough-ty walker!” and kills Turner before attempting to kill Ramon. The pair escapes their cells and Ramon tries to lure the creature away with a police car while Stella goes to the Bellows house to try to reason with Sarah. Stella is pulled back in time and witnesses Ephraim terrorizing Sarah before encountering her ghost. Meanwhile, in the present day, Ramon hides in the Bellows house and is hunted by The Jangly Man. Stella begins tearfully reciting the real story of Sarah Bellows, how she was victimized by her family, which turned her into a rage-filled monster. Stella promises to tell Sarah’s real story if she stops killing. Sarah forces Stella to write her story in the book in blood before both she and The Jangly Man vanish from the face of the earth.
Ramon finally enlists in the army while Stella, with the book in her possession, sets out with her father and a recovered Ruth to try to find a way to bring Auggie and Chuck back.
1968 – It is Halloween in the town of Mill Valley. A young man named Ramon (Michael Garza) drives into town. Nearby, horror fan Stella Nicholls (Zoe Coletti) is called by her friends Chuck Steinberg (Austin Zajur) and Auggie Hilderbrandt (Gabriel Rush) to play a prank on school bully Tommy Milner (Austin Abrams). The jock and his buddies are throwing beer bottles at a neighborhood scarecrow called Harold (Mark Steger). Tommy also takes a swing at Harold with his bat.
Chuck fishes poop out of the toilet and meets with his friends to throw it, plus eggs and toilet paper, at Tommy’s car while he is out with Chuck’s sister Ruthie (Natalie Ganzhorn) and his buddies. Tommy ends up driving his car back into a fence. He and his friends chase after the kids, who run to a drive-in theater and hide in Ramon’s car. The bullies find them and threaten them into getting out, including Ramon. However, they are driven out of there by security, but not before Tommy makes a snide comment to Stella about her mom walking out on her and her father. After the jerks leave, Stella takes a breath outside before inviting Ramon to join her and the guys into checking out a haunted house.
The four go to the home of Sarah Bellows, a figure in an old legend about a disturbed woman who allegedly poisoned numerous children in the neighborhood. The kids enter after Ramon picks the locks on the door. Auggie and Chuck mess around to scare each other, but Chuck ends up hiding in a closet where he sees the old room turn refurbished, and what appears to be an old woman with a dog sitting by the bed. Auggie opens the door to scare Chuck, and everything looks old again. Meanwhile, Stella and Ramon find Sarah’s old book of scary stories. They are then trapped down there by Tommy and his goons. Ruth tells Tommy to let them out, but he locks her in there too. After trying to break out, an unseen force lets them free. They go outside to find that Ramon’s car was vandalized by Tommy, with “wetback” written on it. Ramon must take it to the shop, and since he was living in his car, he has nowhere to go. Stella invites him to come over and stay in the basement.
Tommy drives home drunk and is ordered by his mother to deliver eggs to the neighbors. On his way, he comes across Harold and taunts him again. At the same time, Stella reads from Sarah’s book and sees the story “Harold” appearing. As she reads it, she notices that it mentions Tommy. He ends up walking in a circle and sees that Harold is no longer on his pike. Tommy soon realizes he is being followed by Harold. He trips across a rake and uses it to try and stop Harold, but the scarecrow takes it from him and impales Tommy with it. As Tommy tries running away, his body starts to fill up with straw.
In the morning, Ramon brings his car to the shop, but he is pressed by Chief Turner (Gil Bellows) over his appearance in town. When he sees what Tommy wrote, Turner questions him over the supposed fight he got into with him. Ramon mentions his last name being Rodriguez, and Turner implies he will investigate him.
Tommy is noted as being missing by Stella’s father Roy (Dean Norris). She goes to investigate with Ramon, and they find what appears to be Harold wearing Tommy’s clothes. Stella figures that this is Tommy and that the story she read came to life. She decides to take the book back to the Bellows house to prevent it from continuing.
When Stella returns home with Ramon, he finds Sarah’s book back on Stella’s bookshelf. A new story then begins to appear, “The Big Toe”. This one features Auggie’s name, and it involves him eating a stew containing an appendage, and a disembodied voice calling out “WHO TOOK MY TOE?” Stella calls Auggie to warn him, but he ends up eating the stew, and the Big Toe woman (Javier Botet) starts stalking him. Auggie runs to hide in his room under his bed, but as he thinks he is safe, Big Toe pulls him under the bed and reveals her hideous face before making him disappear. Stella and Ramon show up too late and see the claw marks under Auggie’s bed to have their fears confirmed.
Stella tells Chuck and Ruth that Auggie is gone and that it’s because of the book. Chuck suggests they take it to the police, but Ramon doesn’t want to get involved with them since they might think he had something to do with both Auggie and Tommy disappearing, as there is now a search party going out for the latter. The trio try to burn the book, but it doesn’t work.
The friends go to the Mill Valley Gazette to dig up any old information on Sarah. They find articles about a woman named Lulu Baptiste, who worked for the Bellows family but was fired after Sarah hung herself, and it was believed that Lulu was teaching Sarah black magic. The book then starts to write another story, “The Red Spot”. This one is about Ruthie, who got bitten by a spider while trapped in the Bellows house. She is set to go on stage for a performance of “Bye Bye Birdie”, but the spider bite on her cheek starts to get worse. She goes to the bathroom to check on it, and hears a voice calling her name. A spider leg then pokes out of Ruth’s cheek, before a whole swarm of spiders start crawling out and biting her. Stella, Chuck, and Ramon run to the school in time to catch Ruth and throw water on her to repel the spiders. She is covered in bites and crying to get the spiders off. She is later taken to the hospital.
The friends track down the now elderly and blind Lulu (Lorraine Toussaint) to ask what happened with her and Sarah, hoping to find a way to undo what has been going on. She says there was no magic involved, but the presence of the book overwhelms Lulu.
The trio then heads to a hospital that they think has records of the Bellows family. Chuck mentions having a dream about seeing a pale woman in a red room, telling him, “This is an evil place. Run while you still can.” The kids sneak in and head to find whatever documents they can. Stella and Ramon come across a room with old recordings from Sarah as she received electroshock treatment from her brother Ephraim. They hear the voice of Sarah (Kathleen Pollard), who, as it turns out, was innocent and never poisoned the children, but it was her family’s fault for tainting the water supply, and they tortured her and framed her to cover up their secrets. She then appears to be reciting the new story being written, “The Dream.” Orderlies find Chuck as he snuck in, and the alarm goes off, making everything go red. He then sees the Pale Lady (also Mark Steger), who appears grotesquely overweight and has a horrifying grin etched on her face. No matter where Chuck runs, the Pale Lady keeps coming closer and closer until he cannot escape and she absorbs Chuck. Stella and Ramon find out too late that he is gone, and they are kicked out of the hospital.
Stella calls her father from the precinct. She fears that she is going to die because of the book, and she tells him not to think that she is running away. Roy tells her to not think that it was ever her fault that her mother left. Turner then interrogates Stella and Ramon about the disappearances of their friends. They try to explain that it’s because of the book, but it is too farfetched for Turner to believe. He also brings up that Ramon’s real last name is Morales and that he dodged the draft. The two are placed in adjacent cells, and Ramon explains that his brother was drafted to Vietnam and was killed out there, so he got away after learning he was to be drafted. Soon, the next story is being written, and a monster called the Jangly Man (Troy James) emerges. He breaks Turner’s neck and tosses his body toward Stella’s cell. She gets the keys, but the Jangly Man attempts to get Ramon since his name was in the book, and he knows of the Jangly man from an old story his father told him. Stella frees them both from the cell, and they realize they must run to the Bellows house to put an end to this. Jangly Man chases after them as they take Turner’s car, but Ramon manages to lose him by crashing the car and pinning Jangly Man to a train.
Stella and Ramon run to the Bellows house, where they get separated as Jangly Man goes for Ramon. Stella is pulled into another room by the ghosts of the Bellows family. She comes face-to-face with Sarah’s ghost, who is getting ready to trap Stella in her own story. However, Stella hears Ramon’s voice telling her to tell Sarah the truth. Stella stands up to the ghost and says that she knows that her family killed the children and framed her, but she is becoming as big of a monster as they were by haunting and taking her friends. Stella promises Sarah that she will tell the truth about her. Sarah gives Stella a quill and tells her to write Sarah’s story in her own blood. Stella writes the truth, and Sarah’s ghost wails before crossing over. The Jangly Man goes down as the terror appears to stop. Stella and Ramon run to embrace each other.
Later on, Ramon willingly goes to be drafted in Vietnam. He says farewell to Stella, who gives him a letter and promises to write to him. He reads it on the bus, and it’s a letter from her asking him to come home soon.
Stella writes a story in the school paper about the truth over the Bellows family history. While not many people are listening, she is determined to let the real story be known. She then goes with Roy, and the recovered Ruth, as they plan to use Sarah’s book to find a way to bring back Auggie and Chuck.