The film begins in 1918,[2] where a war widow, Mrs. Allen (Dorothy Alison) and her children, Lucy (Lynne Frederick), Jamie (Garry Miller) and baby Benjamin are reduced to living in a squalid, Camden Town flat. Just before Christmas, a mysterious old man, Mr. Frederick Percival Blunden (Laurence Naismith) visits the family, introducing himself as a representative of a firm of solicitors.[2] The family are told there is an opportunity to become the caretakers of a derelict country mansion in the Home Counties named Langley Park, which was gutted by fire years before, and is now in the charge of the solicitors. Mrs. Allen takes the post despite rumours that the house is haunted, her instructions to care for the property until such time as the heirs to the estate can be traced. The air of mystery deepens when the children see a portrait at the solicitors office of a man they believe to be Mr Blunden. The solicitor confirms this, but reveals that the portrait is of a man called Mr Blunden, but who has been dead for a hundred years.[6]
After they have settled into the new post, Lucy and Jamie see two ghostly figures in the grounds of the house: a teenage girl, Sara Latimer (Rosalyn Landor), and her younger brother, Georgie (Marc Granger). They are two children who lived in the house a century earlier.[7] Sara tells them that she and her brother are orphans, under the care of their dissolute and hapless Uncle Bertie (James Villiers) and the solicitor Mr. Blunden, until Georgie comes of age. Bertie marries a music hall performer, Bella Wickens[8] and her parents then move into Langley Park, ostensibly as the housekeeper and game keeper.[8] The children come to suspect that Mrs. Wickens (Diana Dors) and her disturbed (and often violent) husband are plotting to kill them to get hold of Georgie's inheritance. Sara and Georgie find a book with instructions for travelling through time, so that they can get help. Lucy and Jamie agree to travel back with them; they arrange to meet Sara the next day.
Jamie searches the graveyard, in the hope of finding nothing and being able to go back to help, knowing in advance that they will succeed. He and Lucy are shocked and distressed to find a gravestone marked with the names of both Sara and Georgie. The sexton explains that the two children died in a fire, whose anniversary turns out to be exactly a hundred years ago tomorrow. Nevertheless, Lucy and Jamie still drink the potion and travel back to 1818 in the hope of preventing the tragedy. There they meet Thomas, the gardener (Stuart Lock), who believes they are from America, and tells Lucy and Jamie that he wants to go there one day and make his fortune. Mr. Blunden is visiting the house that night, but refuses to listen to Sara's pleas for help.
That night the children are locked in a room above the library, and given a sleeping potion. Mr. Wickens (David Lodge) starts a fire in the library, trapping the children. Jamie helps Tom to save Sara, but when he tries to return for Georgie, he finds himself unable to get through the flames. Mr. Blunden appears, and tells Jamie that they will go together, holding hands. Jamie is kept safe from the fire, but Mr. Blunden suffers the pain that Jamie would have felt. Jamie and Mr. Blunden save Georgie. The Wickens perish in the fire. Lucy and Jamie both return to 1918, but Jamie is unconscious and Lucy cannot tell their mother what has happened.
At the graveyard, Lucy discovers that the children's gravestone has been replaced by another: that of Frederick Percival Blunden, the "Good Shepherd" who "died to save the children in his care". Jamie soon awakes and is overjoyed to hear that they have succeeded. Shortly after, the lawyer, Mr. Clutterbuck (Graham Crowden), visits them and informs them that recently discovered documents show that Sara Latimer married Thomas and that their great-grandson was the late Mr. Allen. This makes Jamie the rightful heir to the Langley Park.
At the end a car pulls up. When Mr Clutterbuck opens the door, sitting inside is Mr Blunden! But which one? The enigmatic phrase he greets them with is one they recognise from their first encounter. They have all the answers they need.
Who discovers that the children's gravestone has been replaced by another?
Lucy