Pinocchio: Unstrung

Fourteen-year-old James is sent to live with his grandfather Geppetto after his parents perish in a car accident. He makes friends with two other children, Zach and Michael, but Zach dies from terminal cancer and Michael is forced to move due to his mother Mary's new job as a hypnotherapist at the nearby town of Ashdown. Geppetto promises to build a friend who will never abandon his grandson again.

One year later, James and his classmates Mia and Dudley are constantly bullied by high school students Trey and Logan. That night, James is awakened by strange noises and enters the basement where Geppetto works. He introduces James to Pinocchio, a sentient wooden puppet whose nose grows every time he lies. Geppetto explains he built Pinocchio to be James' new friend.

As James and Pinocchio bond to a brother-like friendship, the latter learns about human anatomy and wishes to become a real boy. While James is at school, Pinocchio enters the basement and finds a disfigured wooden creature who introduces herself as Pinocchio's "Wood Mother". She reminds Pinocchio that he is just a puppet and will need human organs to become real. The next day, James takes Pinocchio to school; he explores the gym, but accidentally causes a chain reaction that kills James' teacher with a treadmill. Later, James introduces Pinocchio to Mia and Dudley.

While returning home in a taxi, a drunk driver crashes into them and James is hospitalized under the care of Dr. Christopher Robin. Remembering the Wood Mother's words and realizing that perhaps he should eliminate the people who harm James, Pinocchio sneaks into the driver's hospital room, rips his skin off and disembowels him to put his organs into his wooden chest. James returns home and, along with Mia and Dudley, enters the basement and finds notes written by Geppetto about his "failed works". Meanwhile, Pinocchio tells his Wood Mother about the killings and she congratulates him while introducing the Talking Cricket to Pinocchio. The Cricket encourages him to kill anybody who have put James in danger and they murder James' school dentist to take out her teeth.

James, Mia, and Dudley watch tapes that reveal Geppetto created more wooden puppets before Pinocchio, whom he destroyed because he considered them imperfect to be James' friends. Upon learning about Pinocchio's killing spree, James, Mia, and Dudley attempt to warn Trey and Logan as they are his next targets. Pinocchio arrives at Logan's house and breaks his girlfriend Georgia's jaw with an axe. The Cricket then fatally electrocutes her while Pinocchio rips Logan's tongue and eyes. In Trey's house, Pinocchio kills his girlfriend Amanda, tears off her scalp to use it, and murders Trey by impaling his skull with his growing nose.

Geppetto takes Pinocchio back home, repressing him for the murders. Pinocchio learns his Wood Mother and the Cricket tricked him into doing bad things so he kills them both with a sledgehammer. James, Mia, and Dudley arrive at the basement just as Geppetto is about to destroy Pinocchio. When Pinocchio asks how he came to life, Geppetto reveals to have used Zach's corpse to build him, transfering his soul into the puppet. As James rescues Pinocchio, Geppetto shoots Dudley dead and knocks James unconscious before pursuing Mia to kill her while revealing to be an apprentice of the late Dr. Arthur Gallup, continuing with his experiments to resurrect dead children. James stabs Geppetto before Pinocchio holds him at gunpoint.

Pinocchio shoots at Geppetto but misses and hits a panel that releases an aggressive wooden creature, who kills Geppetto as the entire house begins to burn. James, Mia, and Pinocchio manage to escape and promise to forget what happened. When Pinocchio reveals that he did not enjoy killing people, his nose begins to grow again. In a post-credits scene, the Cricket is revealed to have survived and recovers Geppetto's corpse to resurrect him.