In 1859, a small town is ravaged by plague. Fortunately, the town has Bo Duke as its magi (yes I know "magi" is plural -- the filmmakers, however, do not). He binds the plague and all the evil in the town and incarnates them in the form of an ogre. The plague is cured and the town preserved outside of time, with its inhabitants no longer subject to aging or death, as long as they don't leave its vicinity. However, each day on the Winter Solstice, they must sacrifice one of their number, chosen by lottery, to feed the ogre for another year (since the spell means they can't have kids, this will eventually kill them all, though not for centuries).

In the modern day, four college kids -- the Hero, Heroine, True Believer, and Annoying Girl -- go in search of the legendary town lost to time. For the other three, it's just an excuse to go camping, but the True Believer thinks there's really something out there to find. What he actually finds is a hole, in which he breaks his ankle. The Hero and Heroine find the lost town and stumble upon the choosing ceremony, where a villager named Young Stephen (seriously, even his girlfriend calls him "Young Stephen") is chosen as this year's sacrifice. Back in the woods, True Believer and Annoying Girl find the ogre's lair and, thankfully, immediately get eaten.

Back in town, Hero and Heroine are arrested and imprisoned in the cell next to Young Stephen, whose girlfriend turns out to be Bo Duke's daughter, an aspiring magi herself. The townsfolk sensibly decide sacrificing two strangers whom they don't know will allow them to keep their own alive another two years, so decide to sacrifice Hero this year in Young Stephen's place. Daughter, however, doesn't like this plan, since the strangers never agreed to the pact, so she helps them escape. They flee, escaping from the town, and return to civilization. The end.

Ha! No! They need to go back and rescue True Believer and Annoying Girl, of course. Knowing that no one will believe the truth, they decide to go to the Sheriff's office and tell the deputies that their friends are hurt and lost in the woods, which is 100% true and also far too good a plan to be successfully executed. They crack at the first hint of a raised eyebrow and spill the whole story about the lost town and hideous monster. The sheriff, shockingly, doesn't believe a word of it and asks the kids to wait while he places a call to the local looney bin. Sensing something amiss, they sneak out, steal a police car, and head back to the woods.

Back in the lost town, the ogre gets pissed about not getting his annual meal and goes on a rampage. Bo Duke goes out to stop him and gets eaten. The leader of the town council tries to organize a defense, in conjunction with the daughter, but is undermined by Bo's supporters, who insist on going out into the woods and getting eaten. Hero and Heroine crash the police car, find their friends' bodies, and head back to the lost town to take revenge on the ogre. They meet up with the daughter and defeat the ogre, ending the curse, and causing the town and everyone in it to fade away.

Satisfied with having killed everyone else in the movie, Hero and Heroine return triumphantly to civilization, where they will face charges of grand theft auto and be prime suspects in the grisly double-murder of their friends.