The boy's name is Omri (Hal Scardino), and he lives in a Manhattan townhouse with his family. For a birthday present, he's given an old wooden cupboard. Later, his friend Patrick (Rishi Bhat) gives him a small plastic Indian. His mother finds a key that fits the cupboard door. He puts the Indian in the cupboard, locks the door, and goes to bed - only to hear muffled sounds from inside the cupboard. He opens it again, and is amazed to find that the plastic figure has come alive, and is a tiny, frightened little human, backed into a corner, shouting defiantly.
The secret of the cupboard is that, in connection with the lucky key, it turns plastic into living flesh. The kid is delighted by this discovery, and is soon talking with the Indian, named Little Bear (Litefoot), who has been snatched from the year 1761, and speaks English because he has met English settlers. At first he thinks the kid is the Great Spirit, but eventually, they understand what happened, although not with as much shock and incredulity as you might expect.
The movie, directed by Frank Oz, was written by Melissa Mathison, who also wrote "E.T." (1982), and here uses some of the same ideas: A little boy hides an amazing living thing in his room, and tries to go about his daily life with this secret knowledge. Omri lets his friend in on the secret, and soon is performing neat tricks like turning a plastic teepee into a real one, so Little Bear will have a home.
Soon Little Bear has a 1:24-scale companion, a cowboy named Boone (David Keith), who also starts as a plastic toy and turns into a living miniature, snatched forward from the 19th century along with his horse. The Indian and Cowboy are at first hostile, but eventually become friends. After all, they have a lot in common.
The logic of the situation requires that adults not find out about the little figures; Omri and his friend try to deal with their secret on their own. It's a little monstrous, how they completely possess these little beings, although Omri seems to understand his responsibilities, and is always lecturing his friend: "They're alive! They're real!" That's when Patrick wants to use them more like toys than people.
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