It's three days before Christmas, as the conductor aboard the Toyland Express, Humpty Dumpty, meets two children, Jack and Jill, who are on their way to Toyland. After meeting Tom Piper and Mary, who runs her late father's toy factory, they go to live with their uncle, the evil Barnaby Crookedman, who despises toys and keeps Jack and Jill in the attic. He has plans to shut down the toy factory, and earlier shot down Tom's hot air balloon as he was flying over the Goblin Forest in an attempt to get him eaten by goblins. Jack and Jill sneak out and go to the Toy Factory, which had received a big order from Santa Claus requesting a thousand giant toy soldiers. Just as Jack and Jill offer to help, Barnaby takes them back to the attic of his house and threatens to send them to the Goblin Forest if they go near the toy factory again. Shortly afterward, he hires two crooks named Gonzargo and Rodrigo to sabotage the toy factory. Jack and Jill sneak out and go to the toy factory again, where Gonzargo and Rodrigo, disguised as sheep, drop a monkey wrench into one of the machines, Jack manages to remove it before the machine can explode. Jack and Jill immediately suspect Gonzargo and Rodrigo, though believing them to be sheep, and chase after them, resulting in Rodrigo and Gonzargo being knocked into a well by a ram and Jack and Jill, respectively, get knocked down by an empty pail and fall down the hillagain. Barnaby catches Jack and Jill and orders Gonzargo and Rodrigo, who expose the children's interference with the sabotage, to take them to the Goblin Forest. There, they meet the evil Goblin King who tries eat Gonzargo and Rodrigo. Mr. Dumpty informs Tom and Mary, who go to the forest to rescue them. As the goblins are weak against light, they use a flashlight to fight them off and escape. Barnaby knocks Mr. Dumpty over a bridge for the key to the factory and tries to enter it, but is stopped by Tom, Mary, Jack, Jill, Gonzargo, and Rodrigo, and is forced to retreat. As Tom and Mary finish the Toy Factory's order and fall in love, Barnaby leads the goblins to Toyland, where they invade, setting fire to the buildings and roasting Gonzargo and Rodrigo on a spit. Tom activates the toy soldiers, who soundly defeat the goblins and put out the fire, saving all of Toyland. As Barnaby insults the Goblin King, who tries to kill him, Jack and Jill shine a flashlight on him, while all the toy soldiers do the same, destroying the Goblin King. Barnaby calls him a "pathetic ogre", and the other goblins confront him and chase him off, out of Toyland. Finally Christmas arrives; Tom has repaired Mr. Dumpty. Santa transforms all the giant toy soldiers into small toy soldiers. He notices Barnaby's cat, Scat, who is now homeless since Barnaby's disappearance; he picks her up and pets her. Jill asks for Scat, and just as she gets her, Santa continues on his journey. In the end, Jack and Jill become the adopted children of Tom and Mary.
"The Worst Is Yet to Come" – Gonzargo, and Rodrigo
"It's You" – Tom Piper, and Mary
Release
MGM released Babes in Toyland direct-to-video on October 14, 1997.
Reception
TV Guide rated it 3/5 stars and called it "fine entertainment for its intended audience". In criticizing its old source material as irrelevant to modern audiences, Bill Gibron of DVD Verdict described it as "a waste of time and talent".