Mary and Roberto Valdi return home from a party to find a masked intruder ransacking their elegant country house.

The masked man attacks and brutally kills both of them and then disguises their deaths as an auto accident by driving their dead bodies to an isolated hilltop in their car and pushing it over the edge.

At their parents' funeral, bereaved children Sarah and Marco exhibit a strange mixture of grief and stifled hilarity, chewing gum while weeping and giggling at the elderly priest conducting the graveside ceremony.

A flashback recalled by Guido reveals that he was the masked intruder who broke into the house to rob it, only to be surprised when his employers returned sooner than anticipated, and he was forced to kill them.

That night, Sarah and Marco are visited by floating flames in their beds, which they suspect represent their dead parents.

But Marcia and Carlo cannot see the ghosts, and they try to bundle the children into their car, intending to leave the house and return to their own home.

The frightened couple brings in a medium, an arrogant, caped 'spirit challenger' to exercise the house of the children's parents.

For a while, the children try to inhabit an old lean-to playhouse they'd constructed, while the spiritualist, Mr. Colby, Marcia, and Carlo are outside trying to persuade them to leave the building.

The Sweet House of Horrors is one of four films made for the Italian television series La case maledette (transl.

A last minute casting change happened involving Alexander Vernon Dobtcheff replacing Cosimo Cinieri.