Gnomes from Lancashire build a narrow gauge steam railway to transport them to the mines, and move increasing quantities of gold. An evil goblin steals the train, infiltrates the town and enslaves many of the gnomes as payback for being put in prison. The wood elves come to the gnomes' rescue and chase the goblins out of the forest.
This book is the final part of a trilogy, starting with the two novels in The Little Grey Men Series: The Little Grey Men and Down the Bright Stream.
