When Atreyu announces that he is the hero Gmork has sought, the wolf laughs and succumbs to death. Gmork then reveals that when the princess of the city discovered his treachery against the Empress, she imprisoned him and left him to starve to death. The wolf also reveals that he is a servant of the force behind The Nothing and was sent to prevent the Empress's chosen hero from saving her. There, thanks to the irresistible pull of the destructive phenomenon, the Fantasticans are becoming lies in the human world. Wandering the dangerous city, Atreyu finds the wolf Gmork, chained and near death, who tells him that all the residents of the city have leapt voluntarily into The Nothing. Atreyu lands in the ruins of Spook City, the home of various creatures of darkness. As Falkor and Atreyu search for the borders of Fantastica, Atreyu is flung from Falkor's back in a confrontation with the four Wind Giants and loses Auryn in the sea. Through reading the story, Bastian becomes increasingly disturbed by hints that the characters are somehow aware that he is reading their adventures, being able to hear or even see him at points. By Uyulala, he is told the only thing that can save the Empress is a new name given to her by a human, who can only be found beyond Fantastica's borders. In reaching her, he is aided by a luckdragon named Falkor, whom he rescues from the creature Ygramul the Many. At the advice of the giant turtle Morla the Aged One, Atreyu sets off in search of an invisible oracle known as Uyulala, who may know the Empress's cure. Upon finding Atreyu, Cairon gives him Auryn: a powerful medallion that protects him from all harm.

The delegates are shocked when the Empress's physician, a centaur named Cairon, informs them that the Empress is ill, and has chosen a boy warrior named Atreyu to find a cure. A great delegation has come to the Empress to seek her help against a formless entity called 'The Nothing'. The story Bastian reads is set in the magical land of Fantastica, a place of wonder ruled by the benevolent and mysterious Childlike Empress. Unable to resist, he steals the book and hides in his school's attic, where he begins to read. While escaping from some bullies, Bastian bursts into the antiquarian book store of Carl Conrad Coreander, where he finds his interest held by a book called The Neverending Story. The book centres on a boy, Bastian Balthazar Bux, an overweight and strange child who is neglected by his father after the death of Bastian's mother.

O poveste fara sfarsit de michael ende