Angus Mac Morrow is the lonely son of the head housekeeper of a Scottish manor on the shores of Loch Ness. It is World War II, and Angus's father has gone to serve in the Royal Navy. Angus is struggling to accept the possibility that his father might not come back.

Angus is not allowed to have pets, as his family does not own the estate where they live, but he unexpectedly finds one anyway when he brings an egg back from the shore of Loch Ness. It hatches into a magical creature straight out of Celtic legends: the water horse, also known as a kelpie. But when the egg hatches, what emerges acts much more like a puppy than a monster. However, water horses grow very rapidly, and the situation quickly gets out of hand as Angus tries to keep his pet, whom he has named Crusoe, a secret.

Two other factors come into play. A mysterious stranger, Lewis Mowbray, shows up, as does a detachment of the Royal Army under the dubious leadership of Captain Thomas Hamilton. Captain Hamilton distrusts Lewis but is very attracted to Angus's mother, Anne. Lewis and Angus become friends, however, as well as allies in keeping Crusoe a secret. It is Lewis who recognizes Crusoe as a legendary water horse.

Things get very complicated when Hamilton pursues his cockamamie idea that Loch Ness will become a front in the war, vulnerable to a German submarine attack. His response to this bizarre idea -- that might be an unconscious, or conscious, way for Hamilton to keep himself out of any real fighting -- eventually puts Crusoe and Angus in great jeopardy. This all leads to a stunning, fast-paced climax, where both tragedy and triumph are possible. One suggestion: turn the lights off when you watch that sequence, as it is very dark.

There are no weak spots in the cast, but four characters really stand out and dominate their scenes.

The entire story is told in modern-day Scotland by an older gentleman (Brian Cox) to a pair of tourists in a pub. You do not find out who the older man until the very end, but he tells the tale perfectly and captures the attention of his audience, and mine.

Ben Chaplin portrays the mysterious Lewis Mowbray, and he is also perfectly cast. Despite his air of mystery and tendency to be evasive about his past, he gives a thoroughly likeable Mowbray, whom you know, and Angus knows, can be trusted.

Alex Etel was a real find by director Jay Russell, and is brilliant as Angus. He gives us a very credible little boy who desperately wants to believe in some things, while not wanting to believe the awful reality of his father's fate. Much of the film focuses on Angus, and he never stumbles or disappoints. (In the special features, you see that Jay Russell immediately knew he had found the right boy to portray Angus when he met him. You also see how physically demanding the role was.)

The other main character is Crusoe, and it is a real tribute to the special effects team that they could take computer-generated graphics and a set of models and give us a magical beast that is noble, powerful, vulnerable, playful, thoroughly bonded with Angus and highly expressive. I was especially impressed that, while the water horse grows rapidly, and does change as he grows, Crusoe remains Crusoe throughout the film. Plus, I never felt the interactions between Crusoe and the human actors were anything but realistic-looking.

Two memorable moments: There is a famous/infamous photograph of the Loch Ness monster, taken back in the '30s, that was later proven to be bogus. This film gives us a moment of comic relief, by giving a version of how that picture came to be. Also, the moment when Angus's mother first sees Crusoe is priceless, and rivals the moment of wonder we saw in Sam Neill and Laura Dern in Jurassic Park.