Jack and Doris Oliver meet real estate agent Nancy Flesch to complete the purchase of a house on Huntington hill next door to the mansion owned by the mysterious J. Pierson-Grenville. On the way home they discuss their thirteen-year-old son David, whom they have sent to a psychiatrist because of an imaginary friend. David recalls meeting this friend, Joseph, five months before they moved to Blainesville and how Joseph predicted their move.
Their first evening in the new house, Jack reviews what he has learned about J. Pierson-Grenville from Nancy Flesch and newspaper clippings. Doris suggests they visit the mansion, but Jack says the gate is closed. When David says it isn´t, Jack makes a bet with him. To his surprise, they find the gate open. They proceed to the terrace in back for a better view.
David, wakened from sleep in the middle of the night, sees Joseph on the lawn below, He joins him, until his parents, make him to return to the house. The next day, the Olivers recall what Nancy told them about Joseph. They learn more about him from the local bank manager. David, sitting in a park across the street, meets Lester, who reveals that he, too, has David´s "gift."
Mowing the lawn the next day, David and his father have an altercation over the tractor mower and David runs into the woods. For the first time, Jack and Doris realize that something serious is wrong and that they are up against forces beyond their belief. They take David to the psychiatrist, Dr. Barkley, and confer with their local physician, Dr. Stone. David´s next session ends in the death of the psychiatrist and leaves David in a coma.
Jack reads a book of poems by Joseph in the local library that thoroughly frighten him. He and David almost drown in the pond behind the mansion. The Olivers learn about other drownings in the pond under mysterious circumstances. Jack researches the drownings in the local library while David, supposedly wandering around town, pays a visit to Lester. He is punished for visiting Lester without his father´s permission and runs away again.
Jack finds him in the mansion under Joseph´s spell. Lester, receiving psychic messages, seeks the aid of Father Martin, who prepare´s an exorcism. As they break into the mansion, Jack disappears through a mirror into a hell Joseph has prepared in the basement. Escaping at last, he finds the exorcism has cost the lives of Lester and Father Martin, not to mention Joseph.
Some months later, when Joseph´s will is read, the Olivers find they have inherited the house on Huntington hill as well as Joseph´s fortune. But there are strings attached.