Plot
Late one night, Littlefoot sees a meteor fall from the sky and crashing into the volcano Threehorn's Peak. When Littlefoot describes it the next morning, the adults in Great Valley do not take it seriously, except for two newcomers, the mysterious "Rainbow Faces", who are dinosaurs with rainbow beaks and long necks. The Rainbow Faces tell them of possibilities of wonders beyond what they know, and suggest the rock may be a magic stone of cold fire. Littlefoot tries to tell Cera's father he knows where the flying rock was and how to find it. But Cera's father warns Littlefoot of the Mysterious Beyond, especially parts with volcanoes, are off-limits. Littlefoot's grandfather agrees and tells Littlefoot that until some far-walkers leave the Great Valley, it would be better for them to not worry about the flying rock.
Pterano, the outcast uncle of Littlefoot's friend Petrie, overhears the conversation and conspires to find the rock to use its powers to control the valley. Pterano gets Petrie, who idolizes him, to tell him the rock's location. Littlefoot's friend Ducky overhears Pterano's plan, but before she can warn the others, Pterano and his cronies, Rinkus and Sierra, capture her and set out to find the Stone. Upon discovering Ducky's abduction, the adults tell the young ones how Pterano previously led some of their herd during their search for the valley and encountered a pack of Deinonychus . Pterano was able to escape, but the event left him emotionally scarred, and he was exiled as punishment for leading his followers into danger. Because the adults are slow to reach a decision, Littlefoot, Petrie, Cera, and Spike take off by themselves in search of Ducky.
Meanwhile, Ducky escapes the Flyers and falls into a cave while fleeing. After the children find her, Ducky comforts Petrie, who is distraught about his uncle's actions, by stating she could tell that Pterano is the least wicked of the three Flyers and has potential to do good. Rinkus and Sierra suddenly re-capture Ducky and pursue the children in violation of Pterano's orders, but the children outsmart them. As the Flyers fly away, Petrie tells them not to go and a thunderstorm comes. Later, the adult dinosaurs meet and Grandpa Longneck tells Petrie's mother to find another flier to help her. Meanwhile, Sierra displays mutinous feelings towards Pterano, but Rinkus convinces him to hold off betraying him until they find the Stone.
The children pursue the Flyers, hoping to reach the Stone before them. The Rainbow Faces help them get there, where they discover the Stone is just an ordinary meteorite. Lamenting over this realization, Pterano explains that he meant to create a paradise with the stone's power, not realizing that this paradise already exists in the form of the Great Valley. Unwilling to believe the Stone is not magic, Rinkus and Sierra betray Pterano. However, as they hit the Stone to make it give them power, the volcano begins to erupt.
Petrie's mother arrives to evacuate the children, and they land back at the site where they camped earlier. Pterano is thanked for saving Ducky's life, and his exile is reduced to five years. Petrie cuts in and tries to plead against the punishment, begging the grown-ups to let Pterano live in the Valley forever, but Petrie's mother tells Petrie that even though Pterano may be sorry, it does not change what he did and he must still be held responsible. Pterano, agreeing with the banishment, tells Petrie that everyone has to take responsibility for their actions and assures Petrie that he should be fine. Accepting the result, Petrie tearfully bids Pterano farewell.
That night, Littlefoot finds the Rainbow Faces, who tell him that the stone is not magic, but his search for it was what really mattered, and reiterate that there are many unknowns to be discovered. They then disappear as an object similar to the meteorite soars overhead. As his friends find him, Littlefoot reflects that there are many unknowns and that such unknowns make life wonderful.
