"Impossible!" the girls gasped. Louise and Jean Dana stare unbelievingly through the swirling mists in an isolated lagoon. In mid-air floats a fantastic apparition -- a full-rigged sailing ship! The next moment, the phantomlike vessel dissolves in the fog. Little did the Dana sisters dream, when invited to visit fascinating Chincoteague Island off the Virginia coast, where wild ponies roam, that their carefree vacation would turn into a challenging and exciting mystery. To find the solution, Louise and Jean must find an ex-sea captain, Tracy Forsythe, whose once proud career was ruined under tragic circumstances during a shipwreck years ago. In their efforts to locate the missing man and help the captain's heartbroken family clear his name, the two young sleuths are thwarted constantly by a sinister enemy who resorts to desperate measures to prevent them from unearthing the truth.