The sole surviving Texas Ranger (Klinton Spilsbury) of an ambush arranged by outlaw leader Major Bartholomew "Butch" Cavendish (Christopher Lloyd) returns to fight back as a great masked western hero, The Lone Ranger.

March 1865. A group of Union soldiers escape from Confederate hands in a balloon, accompanied by their former Confederate captor. The balloon crashes on a sinister island where they encounter all manner of oddities and dangers.