On a winter evening a century ago in the ballroom of a grand 19th-century home, a party is about to begin. Dr. and Mrs. Stahlbaum, younger daughter Marie, son Fritz, and older daughter Diana greet guests of all ages who stream into the elegant ballroom.
Uncle Drosselmeyer, a crusty retired sea captain, bursts in with a sled full mysterious bulges under a cover. When the captain finally lets the children open the gifts, Diana receives a prince doll, Fritz a mouse warrior, and Marie a wooden nutcracker dressed as a soldier. Drosselmeyer has them act out a wonderful tale of a battle between the soldier and mouse. To the further delight of the children, Drosselmeyer winds up two mechanical dolls, dressed in Swedish folk costume, who dance until they wind down.
After the party, Marie returns to the ballroom, where she falls asleep holding the nutcracker. Suddenly, huge mice creep in, joined by the life-size Mouse King, who try to drag Marie away. The Nutcracker, grown to life size, enters, leading his toy soldiers into battle to win back Marie.
The fight is desperate until Marie intervenes to defeat the Mouse King, whose warriors bear him away.
The battle over, Marie finds herself in a magical forest, a snowy land of starkly beautiful birch trees. The Nutcracker has turned into a Prince. She and the Prince dance with whirling snowflakes, who then spirit Marie and her Prince off in a sleigh to a sun-drenched palace. There they are entertained by spectacular dance from Spanish, Arabian, Chinese and Russian figures in native costumes; little shepherdesses trailing sheep on wheels; twelve children emerging from the huge skirt of Mother Ginger; waltzing flowers; and the Sugar Plum Fairy and her Cavalier.
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