Synopsis:As the worst storm of the season attacks the island town of Parker Springs, disgruntled rehab psychiatrist David Archer prepares for work with reluctance. That is until he discovers Joshua, a battered and bleeding young boy with surgical scars, in his backyard. He and his wife take the child in at the behest of the local Sheriff and Doctor and agree to hold him until the authorities can arrive and take the boy.
David heads to work where self-destructive young starlet, Brooklyn Chase has just arrived. During a typical group therapy session Brooklyn and fellow rehab patients Clark Stillman and Nikki Miguela. With Brooklyn's insistence Nikki and Clark sneak out that night for a cigarette.
Patients sleepwalk through the halls and viciously attack anyone who is awake. They appear to be under the control of the same malevolent being. David's attention is called to Dormitories and is attacked by a group of Sleepwalkers and is knocked unconscious.
Clark, Brooklyn and Nikki sneak their way through the Rehab center. Clark insists that something is wrong, but Brooklyn refuses to listen and strikes out on her own. She finds her way to the Dormitories and is attacked by Sleepwalker. She barely manages to fight herself free and is pulled to safety by Clark and Nikki. Together they escape the Rehab Center and take shelter in an abandoned Mill nearby.
David finds himself in an industrial complex with a panicking crowd. Swarms of sleepwalkers massacre scientist and civilians alike as they attempt to flee. Joshua finds David and pulls him into a children's classroom. He urges David to hide from away some unknown attacker, but a massive shadow creature tears David away from Joshua. It hoists him into the air and focuses its rage on him while crushing his skull.
David awakens with a scream in the back of the Sheriff's car. He discovers he has been dreaming, but his clothes are covered in mud and his nose has been bleeding profusely. The Sheriff tells David that his wife has been worried and put in a request that he be found. The Sheriff says that many people have gone missing and that he suspects that they just lost their bearings in the storm.
David thanks the Sheriff and returns home. He takes time to speak with Joshua and ask about his history, but Joshua doesn't remember much. In fact the only things he knows for certain are his name, his previous home (Cari) and the tormenting creature in his nightmares, Vargus. Joshua also tells David that Vargus became aware of him in the dream they shared and that he is in danger. David refuses to believe this and insists that Joshua is suffering from delusions based on his obvious trauma.
Meanwhile, Clark, Nikki and Brooklyn make plans to fortify the Mill in case there are anymore attacks. Clark insists that they should enlist some help and secretly distrusts Brooklyn's account of the events at the Rehab Center. He decides to try and find David while the others barricade the third floor offices.
Clark finds David reluctant to leave his wife and Joshua. Instead, David offers Clark and the others the option of staying with him until the storm calms. Clark refuses. He believes that being in the center of town puts them at greater risk if the Sleepwalking epidemic is not localized at the Rehab Center. They part ways.
David is infuriated at Clark's stubbornness and rants to Amy that as she falls asleep. David is unaware that Vargus has taken control of her as he continues to prepare for bed. Suddenly, David is attacked. He fights his way free and locks Amy in the bathroom. Vargus speaks to him taunting him. David runs to grab Joshua, but a sharp pain tears through his brain as soon as he gets close. David can't overcome the tremendous agony and is forced to leave Joshua and escape the house.
Clark returns to the Mill to find that the girls have found a fellow survivor, Duncan, hiding on the lower floors. The fortifications have been completed with his help and the group is set to spend the night in relative safety until Duncan falls asleep. He is taken control of by Vargus and the group struggle to subdue him. In the fight Duncan and Clark break through the barricades making their new hideout vulnerable. With a deadly blow to the head, Brooklyn manages to rescue the others, but not before Nikki takes a mortal stab wound.
Sleepwalkers pour out of the forest and envelope the Mill and it's surrounding areas, but they don't make an attempt to enter. Clark and Brooklyn come to the conclusion that they are not trying to swarm the building, but to cover all means of escape. Clark splits with the group and makes Brooklyn promise to protect Nikki with her life.
He take off and confronts the few Sleepwalkers that have managed to sneak inside the building. He acknowledges that someone must be pulling the Sleepwalker's strings and demands to know who. Vargus answers him directly and uses the Sleepwalkers to attack. Clark fights with everything he has, but is impaled on a ragged piece of timber. Vargus tortures Clark and demands to know where he sent the others, but Clark refuses and leaps from the window taking one of the Sleepwalkers with him.
Brooklyn and Nikki flee through the forest and into a nearby road. David's car speeds down the street and nearly misses them. He skids to a stop and the girls pile into the car. Brooklyn demands that Nikki receive medical treatment and David takes them to the local Medical Clinic.
David does all can to help Nikki, but she is bleeding internally and does not have long to live. Brooklyn attempts to make her comfortable and come to terms with Nikki's impending death. Nikki's wounds cause her to fall unconscious and Vargus claims her body. He taunts David while directing his army of Sleepwalkers to the Clinic. Brooklyn flies into a rage and demands to know everything that David knows. He shares with her his information and his belief that Vargus and Joshua are somehow connected.
The Sleepwalkers swarm the building tearing their way inside. David and Brooklyn flee into the forest nearby and make their way toward David's house. Along the way David falls into a large sinkhole filled with those Vargus has killed. The rain and mud make it impossible to climb out so he sends Brooklyn on without him.
Amy and a group of other Sleepwalkers arrives moments after Brooklyn leaves to find David waiting. David confronts Vargus and demands that he release the people he controls. Vargus refuses and begins to toy with David. David stalls as best he can buying time for Brooklyn.
Brooklyn arrives at David's house and fights her way through a mass of converging Sleepwalkers and into the bedroom where Joshua sleeps....
Vargus was originally an experiment to see if I could take conventional horror principles and merge them with the tonal and character driven aspects of older suspense films. It created something different, but still entertaining.