Shrek, a green ogre who loves the solitude in his swamp, finds his life interrupted when many fairytale characters are exiled there by order of the fairytale-hating Lord Farquaad. Shrek tells them that he will go ask Farquaad to send them back. He brings along a talking Donkey who is the only fairytale creature who knows the way to Duloc.
Meanwhile, Farquaad tortures the Gingerbread Man into giving the location of the remaining fairytale creatures until his guards rush in with something he has been searching for: the Magic Mirror. He asks The Mirror if his kingdom is the fairest of them all but is told that he is not even a king. To be a king he must marry a princess and is given three options, from which he chooses Princess Fiona, who is locked in a castle tower guarded by lava and a dragon. The Mirror tries to mention "the little thing that happens at night" but is unsuccessful.