The Stahlbaums are having as Christmas party with family and friends.
At midnight Clara walks downstairs and things start to get weird, the tree grows the toys come alive and a mouse king comes to life. The nutcracker takes the mouse king one on one and is cornered by the mouse king.
In the heat of the battle Clara shows her bravery and throws a shoe at the mouse king killing him and saving the nutcracker from death.
After the mouse king died the nutcracker was transformed into a prince and the toys became normal and the tree shrinks.
The prince takes Clara to the Land of Snow where there is an enchanted forest and dancing snowflakes greet them.
Clara wakes up with her nutcracker and realizes that it was all just a dream.