Shih Erh (Yuen Biao), a Taoist monk disciple, takes in a scholar named Tsui Hung-Chuen (Lawrence Ng) after he inadvertently burned down his house after battling a demon. Shih Erh and his master Wu Men-Chu (Wu Ma) house and attempt to protect Tsui from the demons and spirits that lurk nearby; however, Tsui encounters a benevolent female ghost named Mo Chiu (Joey Wang), who is confined to the hands of the wicked King Ghost (Elizabeth Lee).
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