Kate Redding, a sister of Nicholas and Sarah, is playing a new computer game called Pirate Islands, which has been created by her father. After Sarah tampers with the computer scanner, lightning strikes the house, and the scanner goes wild, zapping the three siblings inside the computer game. After teleporting inside the game, Kate meets Mars, the main character of the video game. Blackheart, the pirate captain, takes the siblings aboard the pirate ship and threatens to walk them off the plank, Mars climbs aboard and cuts the rope, causes the sails to fall against the pirates, the siblings escape and attempt to find their scanner, only to be cornered by the pirates and drop it into Blackheart's grasp, who uses it unknowingly to zap his crew-mate, causing him to pixelate and melt.
Kate discovers that users are transported between islands in the game through icons, after jumping inside, she ends up on castaway island only to find that Carmen, the second in command, has stolen all the items from Kate's bedroom. The pirates arrive and chase the gang off the island, causing Sarah to trip against a tree trunk which triggers a secret entrance inside the tree, which contains stairways up towards a hidden treehouse, the gang store their few belongings and decide to call this place their new home.
A hidden cabinet inside the tree house stores wet boots, which are found by Kate, who discovers they are power-ups in the game which allows the characters to walk on water, after raiding the pirate ship and discovering a treasure map, Blackheart reappears and threatens them with the scanner, but Mars knocks it out of his hand and they escape from the ship. Kate, furious, returns the next day with the power-up boots and takes control of the ship, stealing the scanner and escaping, she discovers back at the treehouse the batteries are dead as Blackheart has used it multiple times, saddened by this outcome, Kate announces they will have to stay here, 'A little bit longer.'
A new icon is found which transports Kate to haunted island, where the ghost of Captain Quade hides, a previous member of Blackheart's crew who he murdered when Quade abandoned ship to search for the treasure. After almost being killed, Kate luckily grabs Quade's logbook and escapes the ship. After searching the logbook for clues, Kate realises her music box has batteries identical to the one's needed for the computer scanner, however after multiple events, it has ended up in Blackheart's grasp. Back at the treehouse, Nicholas finds a second power up, a jetpack. Kate confronts Blackheart to meet her at the beach to swap the music box for Quade's logbook, but she is kidnapped in her attempt, only to be saved by Nicholas's jetpack joyride. Kate escapes leaving Blackheart with the music box, once more.
Mars raids the pirate ship with a keg and implants Kate's mobile phone, which she uses as a walkie-talkie between the Blackheart's ship and Captain Quade's ship. After scaring the pirate's away from the main cabin. Mars enters and steals the music box, placing it inside the keg and throwing it in the water. The next day the keg washes up and is found to be empty. Back at castaway island, Carmen promises she will give Kate the batteries if she gives her the jetpack, the power-up boots and the logbook. Blackheart suspiciously arrives at the island to destroy Kate once and for all just as Kate programs the scanner to leave the game. Dugal, Blackheart's second in command, races inside and unplugs the scanner from the console, and grabs it. Kate pushes him over and grabs back the scanner escaping, leaving Mars about to be killed and Sarah and Nicholas captured. Kate returns to the village with a newly programmed scanner, this time programmed for destruction. She switches it on and zaps the sky, which begins to be torn apart as the computer game slowly begins to break down. The village catches fire and is destroyed as Blackheart fights his way through the storm and rips the scanner out of Kate's grasp and collecting her bag containing the logbook. With the scanner now programmed for destruction, Kate begins to cry realising it's all her fault, and she doesn't know what Blackheart may do next.