Lily, attempting to make amends for her role in the stallion's death, is captured alongside the mare after Brown Tom is knocked out. Knowing that the horn must be recovered and returned to the stallion, Jack is led by Gump and the others to a cache of ancient weapons while Brown Tom guards the mare. Joined by Gump, the fairy Oona (Annabelle Lanyon), and the dwarves Brown Tom and Screwball ( Cork Hubbert and Billy Barty), Jack searches for Lily before coming across the lifeless stallion and his mate. In the forest, Jack encounters the hot-headed elf Honeythorn Gump (David Bennent, voiced by Alice Playten). In a fit of overconfidence, Blunder challenges Darkness with the stallion's horn in hand, but is instead restrained and taken away. She follows them to a rendezvous with Darkness, who orders them to hunt down the mare. Taking refuge in a frozen cottage, Lily overhears the goblins talking about their slaying of the unicorn and testing the alicorn's magical powers. Lily runs off in terror before Jack can break the surface of the frozen pond. As the stallion dies from the poison and the goblins seize his horn, the forest and the pond freeze, setting the mortal realm into an apocalyptic winter. Jack, proving his love to Lily, dives into the pond to retrieve it.

Once hit, the unicorns bolt, and Lily makes light of Jack's fears and sets him a challenge by throwing her ring into a pond, declaring that she will marry whoever finds it.

Against Jack's pleas, Lily approaches the stallion to stroke him, making him distracted and the perfect target for a poisoned dart from Blix's blowpipe. Meanwhile, Princess Lily (Mia Sara), a mischievous and vibrant girl goes alone to the forest to meet her love interest Jack (Tom Cruise), an adventurous and some-what lustful forest dweller who teaches her the languages of animals before showing her the unicorns as he promised he would someday do. 'Once, long ago', the ancient Lord of Darkness (Tim Curry) laments his isolation in the shadows before sensing the presence of two unicorns who safeguard the Power of light whereupon Darkness instructs Blix (Alice Playten) and his fellow goblins Pox (Peter O'Farrell) and Blunder ( Kiran Shah) to kill the unicorns and bring him their horns to free himself.

Legend darkness tim curry