Divorced rancher Truitt Higdon brings his bratty daughter Bess, thirteen, with him from Texas to pick up a a few very special horses he has purchased from a widow in the Altain Mountains of Russia. Kolka, a thirteen-year-old boy loves these unique breed of small orange coated horses with black spots, especially Pegeshka, an Altain mare. Kolka rides these animals and plays in the dark, mysterious forests with a host of gnomes, elves, dwarfs and brownies. The most mischevious of them all are Xyek a wood sprite and both Viktor and Bladski, who are brownies.
Kolka’s dead father raised and cared for these horse but it was his mother Anastasia who sold some of them to keep the family alive. Bess tricks her father into picking Pegeshka, Kolka’s favorite, as one of the horses loaded and shipped to Texas. Once That’s when Xyek ,Viktor, and Bladski realize they must get these horses back because they belong to King Grigorii, the king of the fairies. Using their magic powers they hide in Kolka’s bag and go with the boy and his mother when they go to get Pegeshka back from a ranch known as Horse Thief Hollow.