Aldebaran, an enchanter, has withdrawn in disgust from the world of mortal human beings, but his daughter Melusine inevitably becomes curious about that world and ultimately runs away to find out about it for herself. Her magic boat takes her, along with three animal friends—a cat, a snake, and a raven—to the shore of a kingdom ruled by Eminondas and Adelisa. Her diamond-studded shoes and extraordinary beauty command their instant respect, and they lodge her with their daughter Blanchelys, hoping that eventually she will marry their son Pharamond.
Melusine finds the wayward affections and hypocritical affectations of the people who now surround her difficult to comprehend. She can find nothing to admire in such paragons of insincerity as the fashionable Sir Diarmid and the seductive Lady Valeria. Her ability to turn herself into a moonbeam allows her to wander invisibly about the court, but her clandestine observations only add to her puzzlement. She discovers by degrees that the marriage of Eminondas and Adelisa has more hatred in it than love, that Pharamond is a drunken libertine, and that Blanchelys is a vain fool. The only admirable person she can find is Garth, the king of a distant country, who has been cast into prison by Eminondas for refusing to marry Blanchelys.
Melusine falls in love with Garth and rescues him from his prison, but she finds that he cannot accept the kind of love she offers and that she must instead accept him on his terms. Unfortunately, his notions of propriety prove stifling and oppressive, and she quickly comes to feel wretched.
Eventually, Melusine is abandoned to live in the forest with a woodcutter’s family, nursing a baby whose arrival was a complete surprise. Garth returns to Blanchelys, made captive by a magic spell unwisely gifted to the princess by Melusine. In order to reclaim her lover, Melusine has to make a bargain with Blanchelys, offering her further magical gifts. Blanchelys tries to cheat her. With the help of the cat, the snake, and the raven, Melusine eventually contrives to win Garth back, but it remains questionable whether their final flight to an unknown destination truly constitutes a happy ending.