We learn that a boy named Bastian runs into a book shop to hide from some school bullies, and when he gets in the room, he meets a man named Carl Coreander. This man owns the book store, however he does not take kindly to Bastian's abrupt intrusion and says that Bastian wouldn't understand any of the books in the store. When Coreander goes to get the phone Bastian notices a book on the table that says the Neverending Story on the binding and around that are 2 snakes that are holding each others tail in their mouths. We also learn about Bastian Balthazar Bux and his characteristic, like he is a short, fat boy, who does poorly in school, and has no mother. After Bastian notices the book he feels drawn to it and then Bastian grabs it and puts it in his backpack and runs to the school, where he hides in the attic and makes himself comfortable. Then he starts reading the book and that's where chapter one begins.
The chapter starts with a creature called the will-o-the-wisp in the Howling Forest, which is a part of a place called Fantastica. The wisp is on his way to deliver a message to the Childlike Empress, who is like the leader of all of Fantastica, and he is to tell her that this thing called a "Nothing" is taking over Fantastica, along the way there he meets 3 other messengers delivering the same message. These three creatures are from different parts of Fantastica, but because they are all on the same mission one of them insists that they travel together but they all want to get there before each other so they race off alone in the end of the discussion. Eventually all three get there arriving at different times, when they arrive at the Ivory Tower which is considered the center of Fantastica because it is the home of the Childlike Empress the four creatures find that the nothing has been spreading in areas all over Fanastica and all these messengers were already there to see the Childlike Empress. Eventually, they learn from the others that the Childlike Empress is very ill and that some people suspect that this is the cause of the nothing.
We learn eventually that the Childlike Empress is actually the center of life for all Fantastican creatures, and that she has great powers but never uses them and treats both good and bad creatures of Fantastica equally, so if she is sick then the rest of Fantastica will die. We also meet a centaur named Cairon, who bears the amulet of the Childlike Empress called the AURYN or the Gem' or the Glory'. This amulet gives the wearer mysterious powers and also tells people that the bearer is a badge for one acting on the Childlike Empress's orders. Cairon has been told to find a boy named Atreyu A greenskin (another Fantastican race) who is a great hunter but fairly young and Cairons orders are to tell Atreyu that he must go on a quest to find out how to cure the Childlike Empress, after Cairon finds Atreyu he gives him the AURYN and tells him to use it wisely because it will make people listen to him, and lead him towards wherever he must go to complete his quest. The chapter ends with Atreyu on his horse Artax galloping through the forest towards the direction the AURYN is leading him.
Atreyu journeys for many days and nights until he comes to a place called the Swamps of Sorrow and here Artax dies because the swamps made him feel like he couldn't go on any further (Atreyu has the AURYN so he is protected from the sorrow.) After that Atreyu was on his own but then he finally comes to a place that looks like a mountain but is actually the shell of a turtle named Morla the Aged One one night while Atreyu was sleeping a purple buffalo told him to go see her to find out how to cure the childlike empress Morla told him to travel to see Uyalala in the Southern Oracle, but also says it is impossible for him to get there because it is much to far away but nonetheless Atreyu continues on his journey. Also at the end of this chapter the story tells us...