Dan Carter and the other Den 2 Cubs enjoy having meetings at their cave near the river's shore. During a treasure hunt one evening, Dan and Brad discover a box containing a strange code which has a mysterious reference to Skeleton Island. Dan and Brad also discover a young boy nearby unconscious on the beach. The boy reveals his name as Jacques but refuses to give any additional information about himself. The Cubs take care of Jacques that night, but the boy disappears the next day. Later, the coded message is stolen as well.

Dan and Brad learn of fur thieves in the area and wonder if there can be any connection to Skeleton Island after they see an unfamiliar boat signaling near the island. The Cubs visit Skeleton Island on a camping trip, and while hiking see Jacques in the caretaker's house. The Cubs speculate that Jacques may be a prisoner on the island.

Through a strange turn of events, Dan discovers the identities of the fur thieves and is forced to help them steal another fur shipment. After several exciting adventures, Dan and the Cubs help bring the thieves to justice, discover Jacques' true identity, and learn the secret of Skeleton Island.