The story takes place in England near the beginning of the twentieth century.

Three young people, two brothers and a sister, find themselves unable to go home for the school holidays and instead must stay at the girl's school, which is empty except for a French governess. To avoid boredom they go exploring and come upon what appears to be an enchanted castle, complete with a sleeping princess. Together with the "princess" (actually the housekeeper's niece, Mabel), they explore the virtually unoccupied castle, where they discover a room of treasures, including a ring which makes its wearer invisible. The four have a series of adventures in the surrounding countryside but return to the castle for a romantic ending.