The Fairy tells the story: The old carpenter Geppetto has created the perfect marionette, Pinocchio, who is able to move on his own. Geppetto sends Pinocchio to school, but the lively and willful little boy decides to go to the circus instead.
Mangiafuoco, the circus director, is tired of telling the old tales over and over again and gives Pinocchio some money to travel around and bring him new stories. On the way Pinocchio is robbed by a pair of scoundrels, Cat and Fox, and has to flee because he is not able to pay for the meal he had at the sausage stand.
A pigeon brings him to the fairy’s house, but the snail needs so long to come and open the door for him so that Pinocchio breaks down in front of it from hunger and cold.
The animals have already prepared Pinocchio’s funeral, but the Fairy reanimates him with some bitter medicine. When Pinocchio denies all the fooleries he has committed, his nose grows longer and longer. The Fairy exhorts him not to lie anymore.
On his way back to school Pinocchio meets his old friend Lucignolo. Both plan to travel to the land where every wish instantaneously comes true and where nobody has to work. But the idler’s land turns out to be an illusion, created by an evil magician who is nobody else than the circus director Mangiafuoco. Out of wickedness he turns the boys into donkeys.
Pinocchio is thrown into the ocean where a huge whale swallows him. There, he hears a loud weeping and follows the voice when he, finally, finds Geppetto who is caught in the whale’s stomach, as well. Pinocchio regrets what he has done and saves his old father.
He has learned from his failures and promises his father Geppetto to become a good boy. In the end the fairy sees Pinocchio’s efforts and turns him into a human.