Sarah Williams (Jennifer Connelly) is a teenaged girl who resents having to watch her baby brother Toby while her parents go out. After reading a book about a mysterious figure named Jareth the Goblin King (David Bowie), and having come to the end of her tether with Toby, Sarah calls out to Jareth to take her little brother away. But when Jareth calls her bluff and steals the baby, she realises that you should be careful what you wish for.
On her adventures, Sarah meets a lot of strange creatures - some who help her, and some who hinder her on the long journey to rescue her brother. Together the group face a race against time as Sarah is given thirteen hours to find her way through Jareth's labyrinth before Toby is turned into a goblin and lost to her forever.