The film begins in 1989, when Andre Toulon's grave is being excavated in Shady Oaks, a cemetery in the backyard of the Hotel Green. We see Pinhead (Puppet Master) digging Andre’ Toulon's grave. Pinhead opens up the coffin, climbs out, and pours a vial of the potion on the skeleton, with Tunneler (Puppet Master), Leech Woman, Blade (Puppet Master) and Jester (Puppet Master) watching. After pouring the formula, the skeleton raises its arms, indicating that André Toulon is alive again. A few months later, a group of parapsychologists, led by Carolyn Bramwell, are sent to the hotel to investigate the strange murder of Megan Gallagher and the lunatic ravings of a now insane Alex Whitaker. It is explained that Megan's brain was extracted through her nose '''('''''by Blade''''')''', and Alex, suspected of the murder, is now locked up in an History of psychiatric institutions. While at the asylum, he begins to experience terrible seizures and premonitions.