Pete is first seen at night running away from his foster, abusive, hillbilly family, the Gogans, with the help of an invisible force he calls Elliott carrying him farther away to safety. When the Gogans get too close, Pete decides to hide in a hollow log until he can ditch them for good and asks Elliott to stay behind. Just then, the Gogans: Merle, Lena, Willie, and Grover come out of the open looking for Pete. They openly try to convince him to come back with them and threaten to hurt him while singing "The Happiest Home in These Hills".
Against Pete's wishes, Elliott throws the Gogans into a mud puddle with one swing of his tail one by one (except Merle who accidentally gets thrown in by his idiotic sons). Nevertheless, they just keep looking for Pete because Lena had paid fifty dollars plus fifty cents legal fee for him, and had no more of that left. She claims that unless they find him, Grover and Willie will have to work on the farm with their own two hands. After the Gogans disappear, Pete decides to turn in for the night and Elliott goes to sleep as well.
The next morning, Pete wakes up to find Elliott, now revealed to be a green dragon when making himself visible for the first time, munching on some apples from a nearby apple tree. Pete, hungry too, joins Elliott for some breakfast. Then, he sings "Boo Bop BopBop Bop (I Love You, Too)" with Elliott to express his joy of finally being free from his foster family's tyranny. Later, he notices a sign that leads to a nearby town called Passamaquoddy. Knowing people wouldn't understand, he makes Elliott turn invisible during the day; much to his dismay. In town, despite the cover, Pete is falsely accused of causing so much trouble by the townspeople that he is considered a source of bad luck when it is actually an invisible Elliott doing it, but not on purpose.
Elliott's latest trick to mess with Miss Taylor's petticoat for rebuffing Pete provokes the entire town including the Mayor to chase after Pete and make him go into hiding. After the mob is gone, Pete scolds Elliott (now visible again). Then, he meets an old man, having been to the pub, named Lampie. After a little talk with Pete, Lampie is surprised and terrified at the very sight of Elliott (still visible), which makes him return to the pub, scared, and try to convince the patrons of what he saw while Pete angrily reminds Elliott to turn invisible again.
Later that afternoon, Pete takes refuge with Elliott in a cave next to a lighthouse. Still mad at Elliott, Pete refuses to play tic-tac-toe with him as Elliott tries to cheer him up. Then, Pete meets a woman named Nora, Lampie's daughter and the one who spotted him entering the cave in the first place. He accepts to go with her after she offers to provide him food and shelter. This makes him want to finish his game with Elliott with joy, forgive him, and return with Nora.
After having dinner and telling Nora his story, she allows him to stay with her. Then, she asks him to describe Elliott to her through a song; "It's Not Easy". The next morning, Pete meets Lampie again who fails to recognize him until he finally notices him and starts panicking but Nora comes to calm him down. When he says he wants to show Elliott to everyone as proof, Pete agrees but Nora thinks otherwise and they proceed to have breakfast and finish up some chores while Nora goes out to buy Pete some new clothes. After the villainous quack, Dr. Terminus and his shill, Hoagy, return to Passamaquoddy, Pete is happy to receive his new clothes and wants to show them to Elliott along with the picture of Nora's long-lost, thought-to-be-dead fiancé, Paul, in order to allow Elliott to find him for her, which both Nora and Lampie encourage him to do so even though Nora is making believe about Elliott and going along with it.
The next day, much to his reluctance, he is made to go to school by Nora, who somehow successfully manages to convince him by asking him if he wants to grow up like the Gogans. On the way to school, when some fishermen accuse Pete for making the fish disappear since they've been having a hard time catching some, Nora comes to his defense by singing a song; "There's Room for Everyone", which Pete and all the other students sing and dance to as well. Nora's song, however, managed to make them late for school. Despite Pete lacking papers and Miss Taylor showing an aversion to him, Nora finally convinces her to take him in as well. During class, Elliott (invisible) rings the school bell but when Pete tries to stop him, Miss Taylor accuses him of lying, imagining things, and committing the act himself, thus, resulting in slapping his hands with a ruler nine times and putting him up as a Dunce as punishment. This provokes Elliott (still invisible) to go wild, break in through the schoolhouse wall, scare Miss Taylor and the other students, break out through the other wall, and back to the cave after Pete scolds him to return there. Thus, school is canceled for the rest of the day, thus convincing Dr. Terminus about Elliott's existence.
The next morning, Pete is helping Nora repaint the lighthouse while Lampie is asleep until he is approached by Dr. Terminus and Hoagy, who intend to buy Elliott, especially since they found out that dragon parts are proven quite useful in all sorts of medical remedies the night before, in exchange for $5 and a "medicine guaranteed to bring on puberty two years ahead of time" but Pete refuses even when Nora comes to his defense. After shooing Dr. Terminus and Hoagy away with the foghorn, Lampie wakes up due to the sound and joins them in repainting and cleaning the lighthouse while singing "Brazzle Dazzle Day" after they decide to adopt Pete into their family.
Later, the Gogans, still searching for Pete, arrive in Passamaquoddy in their wagon. The minute they ask Hoagy about Pete while mentioning Elliott, which frightens the townspeople, they know they're in the right place. As Pete, Nora, and Lampie are fishing, they are approached by the Gogans; having finally found him. Despite their efforts to convince Pete to rejoin them, he appears scared about returning to his old life with them but Nora and Lampie assure him that they won't let them get him again this time. As they try to catch up with Pete and his new family by raft while singing "Bill of Sale", they are rescued by an invisible Elliott diving and swimming towards the Gogans and destroying their raft in the process.
Later, at night, Elliott arrives at Pete's window to inform him that Paul is on his way home by boat as Pete thanks him for saving him, Nora, and Lampie from the Gogans earlier that day. Overjoyed, he rushes over to tell Nora the good news. However, Nora feels that now it's time to be realistic and adjust their lives, which means having to get over the fact that Paul is "gone" and Elliott is just "make believe". Even Lampie doubts having seen Elliott. But Pete still insists on proving he is right; if Paul returns, then everyone will be convinced that Elliott is real until such time.
Then, when Pete is busy working, Dr. Terminus, now in allegiance with the Gogans and the fishermen, arrives and tricks Pete into thinking that Elliott is in town and tearing the place apart and lures him to the boathouse, where the Gogans finally seize him while the rest of them prepare for Elliott's arrival. After Hoagy manages to convince Elliott (invisible) to come into town and rescue Pete from the Gogans, Pete tries to warn him about the trap but it's too late; he walks right into it and it is sprung. While Elliott is struggling in the net, the Gogans try taking away Pete in a sack, all gagged up, in their wagon.
Luckily, after Elliott (now visible) breaks free from his bonds, he breaks out of the boathouse; frightening the Gogans, and stops them from taking Pete away, to which he is grateful to. When Lena tries to show Elliott her bill of sale, the only proof that she rightfully owns Pete, he simply burns it and scares the family and their horse away while all covered in tar after they give up on Pete. As Pete and Elliott laugh over the Gogans' defeat, Dr. Terminus tries to finish Elliott off with a harpoon but to no avail. Then, Elliott destroys Dr. Terminus' traveling wagon, thus, ending his phony medicine business for good.
After Elliott saves the Mayor, Miss Taylor, and some other townspeople from a falling telegraph pole and when Pete notices the lighthouse beacon is extinguished and hears the foghorn, he climbs onto Elliott's back and they fly back to the lighthouse. With Elliott all squished up the stairs, he can barely breathe fire to light the lamp again; especially after it took too much water from some waves. Meanwhile, Paul is arriving back home by boat. Luckily, after Pete encourages Elliott and Nora has finally seen him, he is finally able to relight the beacon.
The next day, Pete and Elliott are made heroes as the townspeople sing a reprise of "I Saw a Dragon" so as to congratulate them for their good deeds. When Paul arrives to shore, he and Nora are happily reunited. Seeing as to how Pete is happily getting along with his new family, Elliott decides it's time to leave and help another kid in trouble. After exchanging tearful goodbyes with each other, Pete and his family happily watch as Elliott flies away into the sky and turns invisible again after Pete reminds him.
Pete appears in the 2016 remake, portrayed by Oakes Fegley. In this incarnation, Pete, a five-year-old boy, is on a road trip with his parents when their car flips off the road after trying to dodge a deer, Pete’s parents are killed instantly, but Pete survives and escapes the crash. He ends up being chased into the forest by a pack of wolves and becomes surrounded until the wolves are scared off by the presence of a dragon with green fur, yellow eyes, and huge wings. Pete is at first frightened but comes to see that the dragon is very friendly. Pete names the dragon "Elliott" after the dog character in his favorite book and the two of them become the best of friends and live together in the forest.
Six years later, Pete, now 11, spots a lumberjack crew illegally chopping down trees near his home. Natalie, the daughter of the site foreman, spots and chases him. When Natalie accidentally falls from a tree and hurts her leg, her screams attract her father, Jack, and his fiancée, park ranger Grace Meacham. Pete tries to run away, but Gavin, Jack's brother, accidentally knocks him unconscious. After that, Pete is taken to the hospital. He escapes from the hospital and tries to get back to the forest, but is unfamiliar with his new surroundings. Grace and the police give chase and soon recapture him after he is cornered in an alley. Grace, Natalie, and Jack invite Pete to stay with them promising to take him back to the woods the next day and have Pete show them where he had been living for six years. When Pete begins talking about his friend, Elliott, Grace begins to wonder. When she was a little girl, her father used to tell her stories about a dragon in the forest. While he said they were true, Grace never really believed them as she got older. But everything that Pete has said and shown about Elliott is exactly what was described in her father’s stories.
When Elliott does, however, and finds Pete settling in with Grace's family, he feels betrayed and leaves but understands his decision.
The next day, Pete, Grace, and Natalie, along with Grace’s father, Mr. Meacham journey to the forest. Upon arrival, they follow Pete to his tree house where he introduces them to Elliott. They are both startled but amazed by what they see with Natalie even coming close to petting him on the nose. However, Elliott is ambushed and tranquilized multiple times by Gavin and his fellow lumberjacks who load Elliott onto a truck and bring him back to the mill where they lock him in a warehouse. Pete is worried about what might happen to Elliott and needs to save him. With Natalie’s assistance, the kids manage to get inside the warehouse without being noticed and remove the chains that are holding Elliott. Although free from his restraints, Elliott is still weak and unable to fly out. With Mr. Meacham’s help, they drive Elliott out of the mill and back to the forest, pursued by the police.
Gavin, however, gets ahead of them and tries to make them stop at the bridge. But they are unable to and ram right into Gavin’s pickup and come to a stop on the other side. Elliott, who now has his strength back, angrily attacks the police force by breathing fire at them. Pete tries to get him to calm down but Elliott does not listen and continues to breathe fire. Jack and Grace end up half way across the bridge, and the enormous amount of fire causes damage to the bridge. The road beneath them gives way, and their pickup ends hanging dangerously over the ravine beneath the bridge. Grace and Jack are trapped and inches away from death. When Pete finally gets through to Elliott that he needs Grace and Jack, he finally calms down and moves in to save them. Suddenly, the damaged bridge completely gives way causing Elliott, Grace, and Jack to fall down into the misty ravine. Just when everyone expects the worse, Elliott emerges from the mist with Grace and Jack riding on his back. They are all happily reunited, but with military helicopters approaching, Pete decides to flee with Elliott back to the woods despite Grace's plea.
Pete and Elliot then return to their now demolished tree house. Now that everyone knows of Elliott’s existence, he will have to leave. This also means that Pete will have to leave his friend for good even though he does not want to. Elliott, knowing these people that Pete met can love and care for him as much as he has, encourages him to go back to them. The two friends give each other one last tearful hug before going their separate ways. Pete returns to live with Grace, Jack, and Natalie while Elliott flies away to find a new home.
In the years that follow, Grace and Jack get married and adopt Pete, while Elliott is not seen or heard from again. However, it is shown that Elliott is living peacefully among many other dragons. Also, it is revealed that Pete himself has knowledge about where Elliott lives.