Ash, Misty, and Brock are still traveling to the mainland, when they notice Maiden's Peak, symbolizing that they have arrived. Brock isn't so excited, however, as it is almost the end of summer, which means it's the end of swimsuit season and he'll have to wait until next year to meet a girl. As the ferry pulls into harbor, an announcement is heard, telling the new arrivals to attend the city's summer-end festival. Ash and Misty are eager to attend, but Brock is still depressed. Suddenly, he sees a beautiful girl standing on the end of a dock, and instantly falls in love. He is run over by a crowd of people debarking the ship, and when he gets up, the girl has disappeared. Meanwhile, Team Rocket has traveled from Porta Vista as well, but are penniless. They hear the announcement of the festival, and plan to pick up loose change that they see lying around. Then, James sees the girl, and falls in love as well. Jessie smacks him, and when he looks over again, the girl is gone.
Ash and his friends wander around the festival area, viewing all the happenings. Brock is still thinking about the girl he saw on the dock. An old woman approaches, and warns Brock that a young, beautiful woman would lead him to doom. Brock doesn't care, though, for he is in love. Misty says that she wouldn't do anything to Brock, but the old hag tells her that she was referring to an elegant lady, not a scrawny little girl like Misty. Ash laughs and agrees, only to be hit by an insulted Misty who drags both Ash and Brock away.
Jessie and James have been looking for loose change for some time, and haven't found anything. Suddenly, James finds a penny, and is approached by the old hag. She gives him the warning she gave to Brock, and James tells her that he already knew that, referring to Jessie. Jessie is about to whack him upside the head, when Officer Jenny shows up. She expresses her gratitude of their diligent search for dropped money, and explains that any amount of money that is lost, no matter how small, must be turned in. She takes the penny and asks Team Rocket to come with her to the station to file a report. Jessie declines, and the three run off.
Ash and his friends, as well as Team Rocket, make their way up the Maiden's Peak the Maiden's Shrine, where a painting that had hung inside is going to be unveiled to the public. The man speaking pulls the cover off of the painting, and both Brock and James are astounded to see the exact likeness of the girl they saw on the piers. The man goes on to explain that the woman in the picture died more than 2,000 years ago. The story goes that she was in love with a handsome young man who went off to war. She waited for him on the cliff constantly, but he never came back. She waited and waited, until her body was turned into stone. Her spirit is said to still haunt the area, forever waiting for her lover to return. The stone still exists and is not far from the shrine. Ash, Misty, Brock, and Team Rocket go visit it, and Brock and James wish out loud how the girl were still around, and say that they would never have let her go. It occurs to Meowth that Team Rocket could steal the painting of the maiden, and they decide to do so, hiding until darkness arrives.
Meanwhile, Brock tells Ash and Misty to leave him at the rock, assuring them that he'll be back to the Pokémon Center where they are staying by curfew. He doesn't, however, but Nurse Joy won't allow Ash and Misty to go get him.
A bit later, Meowth wakes up to the sound of his alarm. He tells Jessie and James to wake up, but they mumble a disagreement. Suddenly, a forceful wind blows through the area, and the doors of the shrine burst open. The ghost of the girl comes out, and uses some sort of hypnotic power to put Meowth back to sleep. She then wakes James up, and he follows her. Soon after, she approaches Brock and he follows her as well.
The next morning, Ash and Misty cannot find Brock while at the same time, Team Rocket can't find James. They discover each other, and Jessie does their motto alone. Part of the way through, James' voice comes out from somewhere, and finishes his part. Then, the doors of the shrine open, and James and Brock fall out in a strange state, not in their right mind at all. Ash asks Brock what has happened to him, but he doesn't answer. The old woman from the previous day approaches, and laughs at how right her prediction was, telling them that Brock and James saw the ghost of the maiden. After Ash has Pikachu try to shock Brock and James back to their senses, the woman goes on to explain that the ghost sucks the life out of men who pass by the area, and leaves them babbling like idiots. She then reveals some anti-ghost stickers and tells them that they will ward off the ghost. She adds that they come with a price, and Ash and Misty give her the money, hopeful to bring Brock back to normal.
That night, at the same time as before, the wind occurs again, blowing all the stickers off of the shrine and Brock. Brock goes with the ghost, but James doesn't want to. He asks Jessie and Meowth why the stickers aren't working, and they explain that it is because they got them for free. Jessie is surprised that James doesn't want to be with the ghost, but floats out anyway. He is about to reach her, when Jessie shoots at the ghost with a flame-thrower. James then falls into the water below, but quickly scrambles back up the cliff and asks if Jessie "really does care." Jessie says no, and explains that she hates the type of girl who is so attached to her boyfriend, that she can't stand to see him go.
The ghost then attacks the whole group, summoning up some more very scary looking ghosts. Ash opens up his Pokédex, but it cannot find any Pokémon. Ash then moves it around, and it focuses on the ghost, saying that it is a Gastly. Since it is a Pokémon, Ash decides to try to battle it. It is to powerful, however, and is able to deter attacks from Ash's Pikachu, Charmander, Bulbasaur, and Squirtle and Team Rocket's Ekans and Koffing. Misty tries her luck with a cross, but Gastly isn't a vampire, so we know how that turns out. Bells start to ring, and the Gastly slowly disappears, explaining his fear of sunlight and promising to return next year.
The next night, the festival attendees put little boats with candles on them into the water in order to light the way for any wayward spirits to find their way home. The Gastly tells the real maiden's ghost that he will return next year. He tells her that, since he is a ghost Pokémon, if he ever meets the ghost of he boyfriend, he will tell him that his girlfriend is still waiting for him.
Brock is still sad that the girl wasn't alive, but he consoles himself saying maybe next year. Team Rocket meanwhile, are having fun playing the drums for the festival's ending celebration, and Misty and Ash join in the fun.