While resting at the edge of an area of the Black Forest, which is named Wolfenwald ("Wolf Wood"), they suddenly see a strange man dressed in archaic garments running past them, weeping.

After Margaret sends them the wrong way, and noting more and more features in the surrounding area changing gradually, the children begin to believe that they have been caught in some sort of weird dream.

After sating his animalistic bloodthirst on a kill in the forest, Mardian leads John and Margaret to the Duke's still-ruined castle and into a secret room only he and Otho knew about, before leaving them with his amulet and with a previously arranged promise to return the following night.

In the gardens, she incidentally overhears a conversation between Almeric and Crispin, who is suspecting that his father's unnatural illness must be linked to the wolf (Mardian) he's been hunting.

After he manages to present the amulet and Mardian's tale to the Duke, Otho snaps out of his poison-induced daze and takes charge to arrest Almeric for his treachery.

When the werewolf returns, Almeric takes Margaret hostage, but John and Duke Otho's arrival foils his attempt to leave Mardian to be slain by the castle guards.

After a celebration and a farewell to Mardian, John and Margaret leave the castle and abruptly find themselves back in their own time, just as their parents are packing up to continue the trip.