Atreyu and Falkor fly through Fantastica, hoping to reach the border of the world and cross to the human realm. From their position in the clouds, they observe the Nothing destroying more and more of their world. Falkor suggests that they have finished the mission and learned the cause of the Empress’s illness and its cure and should return to the Ivory Tower, but Atreyu wants to push forward for a little longer.

Encountering the Wind Giants, the pair learn that Fantastica has no borders, but before they can fly away, the giants’ battles hurl Atreyu from Falkor’s back, and he loses AURYN. Awakening on the beach, Atreyu calls for Falkor, but the luckdragon doesn’t appear. When Atreyu realizes that AURYN is lost, he searches for a path. Hearing music, he observes a procession of dancers comprised of ghosts, vampires, and night-hobs. He follows the group and watches them as they hurl themselves into the Nothing. Sensing that he too is drawn to the Nothing, Atreyu runs away and enters the gates of a crumbling town.