Plot
Cash-strapped Peter Plunkett has converted his ancestral home, the dilapidated Castle Plunkett, into a bed and breakfast after his father's death ten years prior. Owing money to Irish-American businessman Jim Brogan, who attempts to move the castle to Malibu and convert it into a theme park unless he has the money within three weeks time before facing foreclosure, Plunkett attempts to turn the castle into "the most haunted castle in Europe" for the tourist trade. Inspired by his mother Lavinia's stories about the castle being haunted, mostly by their Plunkett ancestors, he and his staff start creating costumes and effects for their first group of American guests.
After a staged haunting gone wrong on the first night and guest Malcolm Clay threatening to expose them, guest Jack Crawford learns about Plunkett's problem. Jim Brogan is Jack's father-in-law; Jack's wife Sharon actually lied to him by using their second honeymoon for Jim on a matter of business.
Later, Jack meets two real ghosts: one of them being Plunkett's six-times great-grand cousin Mary (whose painting Jack admired earlier in the evening) and the other, her newly wedded husband, Martin Brogan, having a scuffle. The latter stabs her to death with his knife in a jealous fury under false accusations of infidelity, a constant "loop" that has been going on each night for nearly 200 years. When the ghosts re-enact the scene again, Jack inadvertently interrupts the "loop" by getting in the way. Mary soon becomes enamored of him.
Having learned about the current situation with the castle, all the ghosts including Plunkett's father, decide to help by staging a full-scale paranormal event. On the verge of leaving the castle, the ghosts strip the Americans half-naked, sabotage their means of transport, knock the phone lines out, and force them back into the castle through a manifested thunderstorm. Jack is spirited away and brought to Mary by her talking horse. He soon learns of the story behind Mary's murder and that her marriage was an unhappy one arranged by her father. Meanwhile, Sharon finds herself enamored of Martin. Realizing how much Jack truly loves and cares about Mary, Lavinia decides to help him out by handing him a book which reveals that true love can bring the dead back to life on Halloween night (which is the following night and the one night of every year where ghosts turn into flesh) so long as the lovers do not have sex.
On Halloween night, Plunkett, his staff, and the guests suffer more hauntings. Jack and Mary have sex. Because of this, Mary becomes a living but rotting old corpse. Sharon professes her true love to Martin, whereas Jack gives Mary a kiss of true love which restores her original youth. As dawn approaches, Sharon aims to embrace Martin in her arms, but accidentally falls out the window and dies. Mary disappears. However, when lying by what appears to be his wife's "corpse", Jack finds out that it is actually Mary, in Sharon's clothes, having been resurrected. Jack and Mary kiss again. Sharon, now a ghost in Mary's wedding dress, kisses Martin before they vanish.
Despite the shocking experience, the guests have actually enjoyed their stay at the hotel and Clay promises to recommend Plunkett's castle as "the most haunted castle in the world", saving Plunkett and his staff from financial ruin. Another guest, Brother Tony, a priest who was there for a vacation before taking his final vows, resigns from his state of priesthood to pursue a romantic relationship with guest Miranda. Jack decides to stay and dances with Mary before proposing to her. Martin and Sharon appear, and the two couples dance together.
