A group of human hunters, having unsuccessfully caught any game after several days have passed, come to the realization that they have come across a Unicorn’s territory, a sacred area where animals are kept safe by the Unicorn’s magic. They abandon the hunt but before leaving the Unicorn’s glen one of the hunters shouts out a warning to it that she may be the last of her species. The hunter’s message bothers the Unicorn and though she initially rejects the idea, skepticism and concern begin to trouble her and she eventually resolves to leave her forest to get answers.
During her travels she is surprised to discover that humans that encounter her no longer recognize her as an enchanted creature--seeing a beautiful white mare rather than a Unicorn. She eventually comes upon a sentient butterfly that speaks in cryptic riddles and songs. Initially, the butterfly is evasive about what he knows of the fate of the rest of the Unicorns but he relents and gives her a warning: her kind has been herded against their will by a fearsome magical beast known only as “The Red Bull” controlled by King Haggard.
During her quest Mommy Fortuna, a powerful witch who owns and operates a traveling carnival, imprisons her intending to make her part of her roster of sideshow attractions. Fortuna casts spells on common animals to make patrons believe that they are seeing mythical, legendary beasts such as manticores and satyrs. The Unicorn also receives a similar magical treatment as humanity has all but forgotten her kind. She notices however that she is not the only true enchanted being in the carnival: along with her is a true harpy, Celaeno. A magician named Schmendrick, part of Mommy Fortuna’s carnival troupe, sees the Unicorn for what she truly is and takes pity on her unlocking her cage in the middle of the night. She in turn frees all the other beasts in the carnival, even the harpy Celaeno. Once freed Celaeno takes her revenge on Mommy Fortuna and her hunchbacked lackey, Rukh.
Schmendrick, upon seeing that the traveling carnival is no more, decides to accompany The Unicorn on her quest to find the rest of her kind. Bandits come upon the pair one night and Schmendrick is captured. The Unicorn rescues him but attracts the attention of the bandit leader’s wife, Molly Grue, who is tired of a life of banditry and sees the two as a way out. Joins them on their quest and together they reach the town of Hagsgate located in a territory under King Haggard’s sway. Drinn, a local from Hagsgate tells the trio that the town is under a curse because their king is under a curse himself. The curse can only be broken if someone from Hagsgate manages to destroy King Haggard’s castle and continuing to tell the prophecy Drinn speaks of a baby boy that he found in the Hagsgate market one winter’s night. He knew that the child was the one foretold who’d bring down King Haggard and break the curse.
King Haggard comes upon the baby the following evening however and raises the child as his own. On route to the king’s castle the trio encounter The Red Bull, chasing The Unicorn down and eventually cornering her. Attempting to rescue her Schmendrick cast a particularly powerful magic spell on The Unicorn, accidentally turning her in to a beautiful human woman. The sudden transformation confuses The Red Bull who gives up the assault and returns to his master. The spell has devastating results on the Unicorn: whereas she was once immortal, she is now mortal and suddenly separated from her magic.
Worse, Schmendrick reveals that he is incapable of reversing the spell, as he too is immortal, as mortals are the only ones that can wield real magic. Molly and Schmendrick encourage the now human Unicorn to resume her mission. The trio finally arrives at King Haggard’s castle where they offer their services and loyalty to him in order to learn the whereabouts of the other unicorns. The Unicorn is introduced under the pseudonym “Lady Amalthea” so as not to arouse the suspicions of the King and they are allowed to participate in court. Amalthea’s beauty attracts the attention of the King’s adoptive son, Prince Lír.
In time they discover that the rest of the unicorns have been trapped in the sea for King Haggard’s amusement, as they are the only things that make him happy. Upon divulging this information he then explicitly alleges that she has come to their kingdom to rescue the unicorns and that he is aware of her true identity. Amalthea, however, seems to have forgotten about her true nature as well as her quest. Having been reminded of her quest, the three resume their efforts in earnest and following the advice gleaned from a cat they locate the entrance to the Red Bull’s den. King Haggard and his forces try to stop them but they manage to enter the lair where Prince Lír joins them.
The Bull immediately attacks them and Schmendrick casts a true spell to restore Amalthea to her original form, willingly giving up his immortality in the process. Lír tries to defend Amalthea by foolishly getting in between the charging bull and her, and he is promptly trampled to death for his heroics. Infuriated by the death of the prince Amalthea manages to awaken her latent magical abilities and she succeeds in driving the Red Bull into the sea.
The Red Bull, being an elemental creature of fire, perishes immediately in the sea, and with its’ death the other unicorns are freed. They promptly return to their forest and with the unicorns gone King Haggard falls into despair once more and his castle slowly begins to come undone and soon there is no trace of it. The Unicorn revives Prince Lír with her magic, and now, with King Haggard gone he wishes to follow her back into the forest but Schmendrick counsels him not to.
Later they learn that the man Drinn is in truth Prince Lír’s true father and that he had left him in the market place to fulfill the prophecy. Seeing condition of Hagsgate, Lír resolves to take on the duties of a king to restore the city. Schmendrick and Molly part ways with Lír and The Unicorn content to live out their lives on the edge of the kingdom.
The Unicorn/Amalthea returns to the forest, but before she does she confides to Schmendrick that the experience of mortality has changed her. She is unique in that she is the only unicorn to ever understand what it is to feel love--and feel regret. Many years later Schmendrick and Molly cross paths with another princess in need of help and they advise her to go to Lír as he is a hero.
