A few years ago, a carriage carrying a wealthy passenger makes its way down a path in the Enchanted Forest. The driver stops when an injured man is seen blocking the road. The wealthy man's guards offer assistance while a figure drops down from above to steal the fortunes inside the carriage. The injured man isn't really hurt. This was all part of a ruse orchestrated by Robin Hood and his Merry Men. They receive assistance in the robbery from a young man named Will Scarlet, who is also known as the Knave of Hearts.
Robin Hood lets Will know that he is one of them for life. He's one who helps others in need. Will wants Robin to help him infiltrate Maleficent's castle to swipe her treasure. It's dangerous to cross a sorceress, but they should be okay if they only steal the gold. Will lets an unseen woman know that he's successfully tricked Robin Hood and his Merry Men into thinking he believes in their cause. He vows that they will have the life they want once they rob the castle.
Will leads Robin and his men into Maleficent's castle while she is away. He lets them go off to find her gold while he seeks his true desire: a small mirror. When the men return to the woods, they receive a message from Maleficent in the form of a green swirling fire. She tells the thieves they can keep the gold, but wants the powerful other treasure that was taken. Robin wants to know who disobeyed his orders. He realizes it was Will. Robin banishes him from his group assuring him that he'll eventually meet the fate he deserves.
In the present, Alice needs to know who got to the Genie's bottle before they did. The Knave suggests they find the Forget-Me-Knot, a valuable piece of rope that forms a round picture frame. When held before a place, you can see the last thing that happened there. The Forget-Me-Knot is currently in the hands of the Caterpillar. The Knave wants to make a deal with the creature even though he's already in his debt. Alice realizes the smoke-blowing Caterpillar doesn't have the Forget-Me-Knot. The Knave offers to get it in exchange for an erasure of his debt. Now all he and Alice have to do is retrieve it from a dangerous creature known as the Grendel.
As Alice and the Knave approach Grendel's house, they fall into a pit trap. They awaken inside tied up in the kitchen. Grendel plans on having them for dinner. But first, he gazes into the Forget-Me-Knot. An image of a happy couple appears inside. They must have been the last people in the room. The Knave realizes there still may be a way to get exactly what they came for. He strikes up a conversation with Grendel about the beautiful woman he's been watching. He realizes the beast loved her. He also lost her. The Knave knows exactly what he's going through. The only way to move on is to let go of the hurt. Grendel can't do that.
Jafar found the message Alice sent to Cyrus where she wrote she's coming for him. The Red Queen opens a book filled with hideous creatures. It even shows the sarlacc, which will digest her over many years. They need something that will force Alice to use one of her wishes though. Thanks to info from the White Rabbit, the Red Queen knows that Alice is afraid of a beast known as the Bandersnatch. Jafar can see that it's true judging by the look on Cyrus's face. Jafar orders the hideous boar-like beast to find Alice.
Grendel fires up the pot where he intends to cook his guests for dinner. Alice manages to break free by using one of her wishes. She didn't waste it though. She only used its sharp edge to cut through the rope. There's more than one way to use a wish. Alice and the Knave move to the front door to escape Grendel only to see the Bandersnatch charging toward them. The beast crashes through the door knocking Grendel unconscious. It searches for Alice, who has a plan. She traps the Bandersnatch in the Forget-Me-Knot. There's a mighty struggle as the beast moves to attack Grendel. The Knave gets there first. He stabs the Bandersnatch dead.
When Jafar learns that the Bandersnatch has been killed, he realizes he's been tricked. While it's true that Alice was once truly afraid of the beast, Cyrus helped her overcome her fear by learning how to defeat the dumb creature with poor eyesight. It helps to know who you're up against. As for Grendel, the vision of his wife is now gone forever. He no longer has any use for the Forget-Me-Knot which he stole from the Red Queen. It's the act that led to his hideous disfigurement. The Knave cannot fault him for doing what he had to do to be with the woman he loved. Grendel gives the knot to Alice and the Knave hoping it brings them what they desire.
Jafar and the Red Queen show up a short time later to ask Grendel the identities of his recent guests. They vow to reunite him with his wife if he helps them. The Red Queen becomes extremely uneasy when she hears that the person traveling with Alice is known as Knave. Jafar keeps his promise of reuniting Grendel with his wife in the most violent of ways. He stabs him dead with his staff. Jafar then pays a visit to the Caterpillar demanding to know everything about the Knave of Hearts.
Alice and the Knave return to the spot where the Genie's bottle was stolen. They use the knot to see that it was the White Rabbit who betrayed them. Alice realizes that the Red Queen has been a step ahead of them for some time. As for the Knave, he knows that giving the Caterpillar the Forget-Me-Knot will erase his debt. He also knows that this powerful device would then be in the hands of the worst larva in Wonderland. He burns the knot to prove that he's not truly a thief. He's actually someone who hopefully has a shred of humanity about him. Alice assures him there's no "hopefully" about that.
In the past, Will Scarlet races through the woods shouting Anastasia's name. She's the woman the Knave once said was part of his tale of heartbreak. Will can't wait to get to her. When Anastasia steps out of their home, we see that she the one who is now known as the Red Queen. She was once in love with Will, who presents her with the mirror. It opens a portal. The two awestruck witnesses kiss passionately. Will asks about the new world Anastasia wants them to go to. It's a place where the impossible becomes possible. It's a place called Wonderland.