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 further away to safety. When the Gogans get too close, Pete decides to hide somewhere in empty log until he can ditch them for good and asks Elliott to stay behind. Just then, the Gogans: Merle, Lena, Grover, and Willie come out of the open and start singing "The Happiest Home in These Hills" as a way of convincing Pete to come back with them and threatening to hurt him.
Against Pete's wishes, Elliott throws the family 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 $50 plus 50 cents legal fee for him, and had no more of that left. She claims that unless they find him, they 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 in 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, Pete makes Elliott turn invisible during the day; much to Elliott's dismay. In town, despite the cover, Pete is falsely accused of causing so much trouble in town by the townspeople that he is considered as a source of bad luck when it is actually an invisible Elliott doing it but not on purpose.