When small-time inventor Rand Peltzer (Hoyt Axton) comes across a mysterious little creature called a mogwai while selling products in Chinatown, he buys the critter for a Christmas gift for his son, Billy (Zach Gallagan). The mogwai, Gizmo (Howie Mandel) is quite the popular pet until Billy breaks the rules of mogwai ownership: never get it wet, keep it away from bright light, and don't ever feed it after midnight. Soon the peaceful town of Kingston Falls is infested by violent malevolent monsters known as gremlins, and only Billy, his girlfriend Kate (Phoebe Cates), and Gizmo can put an end to the horde and prevent the town from becoming a gremlin paradise.