Coco is a young girl deeply fascinated by penguins, constantly wearing a penguin costume with sleeve-like wings—a cherished gift from her deceased father. When bullies mock penguins' inability to fly, she defiantly insists her father once flew among them. Her own flight attempt ends in a fall, triggering the film’s events. During this fall, she discovers a golden feathered wing and a penguin-shaped capsule containing a robotic toy cat. The toy transforms into Chaley, a goblin who declares Coco the prophesied "flightless bird" destined to save his world. Chaley guides her to a hidden store of penguin merchandise, secretly followed by her grandfather, which serves as a portal to a goblin-inhabited fantasy realm.

Goblin villagers reveal that Buccaboo, an evil entity, and his henchman Zammie are destroying their home. Coco brands Zammie a bully but initially rejects her savior role, stressing she is human. Suspicion drives her to investigate Zammie with Chaley, uncovering his true identity: a fallen angel stripped of one wing and manipulated by Buccaboo. They help Zammie flee Buccaboo’s lair, aiming to retrieve his wing so he may return to heaven. To accomplish this, Coco must fly. Drawing on memories of her father, she spiritually summons him and gains flight ability, aided by her grandfather and deities from a statue in her world. After Buccaboo’s defeat and Zammie’s ascension, Coco returns home to find the penguin store vanished, Chaley reverted to a toy, and her grandfather added to the statue. This journey resolves both the goblin world’s conflict and her grief over her father’s absence.