A pair of travelling entertainers pass through Waratah National Park en route to their next performance. When Skippy disappears during a magic performance by Alfred the Great, Matt realises they've been conned. But that's nothing compared to what Skippy is capable of — with a little help from her friends.
Clancy's music teacher stops by Ranger Headquarters to share her concerns with Matt about Clancy's recent change in behaviour. Mark convinces Sonny Clancy is living a double life and is being blackmailed — just like in Sonny's novel. While Sonny waits to catch the blackmailer, Matt follows Clancy in Sydney and discovers the truth.
Mark and Jerry go to investigate when Clancy notices someone lurking near the helicopter hangar. Jerry is astounded to find someone he has known since childhood. His friend, involved in an armed robbery and with a bloodied bandage around his head, convinces Jerry he is innocent and asks for refuge in Waratah National Park.
Matt Hammond is expecting a visit by a man to assist with blowing up an abandoned mine in Waratah National Park. The man turns out to be an old army buddy, Toby Boughton. Later, following an accidental detonation caused by a wombat, Matt and Toby are trapped in the mine which is slowly filling with water.
Sonny discovers two dead possums in their tree trunk home and Matt is disturbed by the number of dead animals that have been found in the bush over the last three days. When Skippy is poisoned and almost dies, Matt calls in Veterinarian Officer John Manson. A poultry farmer with a grudge against Matt is responsible and Matt tricks him into revealing his guilt and the location of the poison.
Sonny finds a man chopping down trees in Waratah National Park and when Sonny tells him it is illegal, the determined man insists that he owns the land. Matt Hammond has received word from Jerry of a bulldozer clearing land in the Park, and Mark radios in from his patrol boat that someone is building a fence down by the river. It transpires that "Honest Jack", a slick operator, has been selling blocks of land in Waratah National Park. For his final scam he tries to sell off Ranger Headquarters as an 'ideal home'.