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Carolyn Muir, a young widow from Philadelphia, moves into Gull Cottage on the coast of Maine with her two young children, family dog, and housekeeper. Unknown to her Gull Cottage is already inhabited by the ghost of the former owner Captain Daniel Gregg, a charming but somewhat aggravating ghost who is not sure if he wants this family in his home.
A young couple on the way to their wedding get stranded at Gull Cottage for the night and Captain Gregg is beside himself at what to do with them. So he decides they must get married that night.
With the house badly in need of repair, Carolyn tries to play off Claymore's vanity by telling him that a national magazine wants to do a photo shoot of Gull Cottage and if he could attend to some of the work that needs done it would be much more impressive. The Captain finds her plan amusing and bets her $5 dollars that Claymore will not do the repairs, but when it appears that he really won't fix the necessary items, the Captain comes up with a brilliant scheme of his own.
Claymore brings a stranger to look at the house who claims he is a student of architecture and wants to take photos of the house. When he comes back to the house after the Muirs leave for the evening Captain Gregg thinks he's a burglar and tries to scare him away, not realizing that he is actually a parapsychologist who is determined to find the ghost of Gull Cottage and make him known to an unsuspecting public.
The local historical society wants to erect a statue of legendary local Navy hero Captain Figg. Captain Gregg is insulted that he wasn't chosen and wants Mrs. Muir to expose Figg as the coward he was, but Mrs. Muir must have proof.
Vanessa Peekskill, the great-great-granddaughter of Captain Gregg's true love, comes to Gull Cottage to research their romance, and the Captain is quite taken with her.
When antique hounds visit the cottage, Claymore tries to sell them the Captain's barometer by switching it for a replica he had made, but the Captain switches them back and Claymore is arrested for selling the fake.
Mrs. Muir's Uncle Arnold who sells magic tricks comes for a visit. Candy asks for him to stay and perform at her birthday party until they find his tricks don't work and his stories grow old and stale fast.
When Claymore gets Mrs. Muir to star in his amateur theatre production, the Captain feels abandoned and decides to disrupt the show.
Captain Gregg reluctantly consents to removal of the antiques and replacing them with modern furniture to make the cottage a home, but when she has his prized monkey puzzle tree cut down after a window is broken the angry Captain leaves.
When Carolyn is desperate in need of money to fix the plumbing but can't think of one idea for her article, Captain Gregg comes to her rescue with disastrous results.
The Captain extends a series of invitation to Carolyn for conversation and Madiera, to celebrate the end of the passing day, but things never quite seem to work out as he intended, due to ""petty household chores.""
When Martha takes an interest in the local dentist, who seems to ignore her advances, Carolyn takes the matter into her own hands, enlisting the Captain for a little help.
A former beau literally sails back into Carolyn Muir's life on his yacht and asks her to marry him much to the jealously of the Captain.
Prompted by her family doctor, Carolyn sees a psychiatrist, who convinces her that the Captain is a delusion she should ignore. When the psychiatrist shows up at Gull Cottage, the Captain takes delusion into his own hands.
Everyone knows that the Captain and Scruffy don't like each other, and the Captain's really in the doghouse when Scruffy mysteriously disappears.
Claymore has an accident, hurting his back, and ends up convalescing at Gull Cottage, running the Muirs ragged.
When Jonathan accidentally tells Carolyn's visiting in-laws about the Captain, they believe he's a living person and jump to the conclusion that Carolyn plans on marrying him.
The Captain's face is being used on the label of a new brand of chowder, and both he and Mrs. Muir are annoyed but for different reasons.
The Captain's attempt to make up for interfering in Jonathan's education involves scrimshaw, a parasol, a loan from Claymore, and a lot of regrettable secrecy.
Taking a job at the Schooner Bay Beacon, Carolyn finds herself overworked by the editor. The Captain misses her, and has never forgiven the Beacon's inaccurate reporting of his death.
Carolyn's distraught friend Aggie comes to visit after breaking up with her fiancé. Carolyn and the Captain set her up with Claymore.
Jonathan's history essay wins first place, but when he changes the essay to reflect facts the Captain provides, he stirs up resentment and puts his prize and the family's peace in jeopardy.
Carolyn comes down with a bug, and Captain Gregg, dissatisfied with the doctor, concocts his own remedy which sends Mrs. Muir back to the mid-1800's where she is the "ghost" and the very much alive Captain is the only one who can see her.
The kids find a clock with a curse on it. After the clock is started the last living Gregg will die at midnight, Claymore Gregg.
The Captain is continually interrupted when trying to read Carolyn his poem for her, but her rapt attention to a singer-songwriter stranded at Gull Cottage gives the Captain an idea for getting his poem heard.
