Children's book author Jessica is married to musician Max. Max has two daughters from his first marriage: younger daughter Alice, and teenager Taylor. Alice enjoys Jessica but Taylor keeps her at arms length. Jessica is plagued by nightmares which include her mentally-ill father Ben and a fictional character from her books, Simon the spider. When the family moves into Jessica's childhood home, Alice discovers a teddy bear in the basement named Chauncey and quickly forms a bond with him. An elderly neighbor named Gloria, who babysat Jessica when she was a child, reunites with her. Gloria shares memories of Jessica's childhood, which she cannot remember.Alice and Taylor's mentally disturbed biological mother Samantha sneaks into the house to see her daughters and attacks Jessica. When the police arrive to arrest Samantha, Taylor confesses to texting her. Jessica then puts Alice and Chauncey to bed, and remarks that she had a similar childhood friend.Max leaves to embark on tour and Alice becomes hyper-focused on a scavenger hunt she claims was given to her by Chauncey. Chauncey's overwhelming presence in Alice's life begins to disturb Jessica. One day when Jessica leaves to visit Ben, Taylor invites an acquaintance over, Liam. Liam grabs a bottle of liquor which he accidentally shatters. He attempts to find a towel before being toyed with by Chauncey, who briefly turns into a monstrous bear. Jessica arrives back home, angering Taylor.Jessica narrowly stops Alice from slamming her hand down onto a nail prompting her to call a child psychologist named Dr. Soto. Soto observes Alice talk to Chauncey while also speaking on his behalf. Chauncey makes threatening remarks towards Jessica and Alice sobs over their crumbling friendship. Jessica later discovers that only she and Alice can see the stuffed bear. Soto then shows Jessica footage of a past patient who uses the same phrase as Alice: "Never Ever". Alice disappears after speaking to Chauncey which Taylor blames her stepmother for.Taylor meets Gloria, who tells her that Chauncey was also Jessica's childhood imaginary friend. Gloria explains to Taylor that imaginary friends are spirits who tether to the young and can become sinister if abandoned, which Jessica did with Chauncey. At home, Jessica goes through her old belongings and finds drawings of Chauncey and of the Never Ever. All three women complete the scavenger hunt together, resulting in a glowing door leading to the Never Ever realm to appear.In the Never Ever realm, the group find a door showing Jessica's repressed memories. As a child, Jessica was lured by Chauncey into the Never Ever. Ben had rescued her, but he became mad in the process after seeing Chauncey's eyes. Afterwards, Jessica was sent to live with her grandparents. Gloria closes the escape route, having become obsessed with the realm throughout her life. Gloria is savagely mauled by Chauncey when a door opens beside her. Jessica and Taylor rush off, searching for Alice. Both find Alice and attempt to escape while Chauncey pursues behind them. Jessica is able to stop Chauncey by stabbing him in the eye with scissors.After reuniting with Ben and Max at Ben's institution, Jessica realizes she is still stuck in the Never Ever. Chauncey used Alice as bait to get to Jessica and seeks revenge for her prior abandonment. Taylor arrives and saves Jessica. Chauncey turns to his true form akin to Simon. The spider tries to turn Jessica and Taylor insane with his eyes, but Alice sets the creature on fire and seals him behind the door. The family escapes as the house burns to the ground.The family check into a hotel but are frightened by a child playing with his teddy bear who resembles Chauncey. The three leave to another hotel for their safety.