In the mid-1940s, an elegant coupe crawls deep into a remote Spanish mountain wilderness. Side by side for the ride are Carmen (Adrianda Gil), a newly remarried widow, and Ofelia (Ivana Baquero) her preteen daughter from a tragically shortened first marriage. Mother and daughter each tenderly hold precious cargo. Carmen carries the unborn child of her new husband, Franco loyalist officer Captain Vidal (Sergi Lopez). Ofelia cradles a book of fairy tales in her lap that to her is no less vital than her future half-sibling’s wellbeing.

In Guillermo Del Toro’s powerful new film “Pan’s Labyrinth,” each of these characters also harbors fantasies that, though as different as wide-eyed innocence is from self-deluding neediness, are equally fantastic. Carmen expends every ounce of faith and energy that her difficult pregnancy permits her trying to believe that her new husband, clearly a fascistic sociopath, is a heroic soldier, a husband who loves her as much as he loves the heir she carries, and that he is as fit and fair a potential father to Ofelia as her sainted first husband.

Ofelia needs to believe that the promises of magical transformations and otherwise impossible family reunions made so real in fairy tales are what await her when she and her mother arrive at Captain Vidal’s remote mountainside garrison.

Before their journey has even ended, Ofelia’s imagination has penetrated a loosely anchored veil between fantasy and reality. Once she and her mother arrive at their destination, a rambling manor house compound from which the Captain seeks to crush the Republican resistance still fighting in the woods, Ofelia hits the fantasy jackpot.

“Are you a fairie?” Ofelia asks a large and rather ominous insect whose fancy she catches. In one of the most inspired unmaskings of the emotions underlying childhood flights of imagination I’ve ever seen on film, the insect answers by turning itself into the thing that Ofelia wants to see more than anything else in two worlds. Moreover, it leads her into a garden maze where she meets a solicitous but no less ominous satyr named Faun (Doug Jones).

Ofelia, Faun excitedly tells her at uncomfortably close range, is in fact the missing daughter of a storybook king. Well, she could be. In order for her to prove that there’s an empty throne with her name on it, there are just a few little tasks she’ll need to complete.

Since his sensational feature debut, 1993’s “Cronos,” the Mexican-born Mr. Del Toro has made a string of horror and fantasy films evincing a rich and capable visual imagination. Not surprisingly, Hollywood came calling almost immediately. Is it damning with faint praise to say that of the glut of video game-like genre movies that substitute exponentially louder and busier action scenes for storytelling, “Blade II” remains one of the best? “Hellboy,” Mr. Del Toro’s finely textured if overlong adaptation of Ron Mignola’s comic book series was one of the real surprises of the 2004 late winter dog days.

But “Pan’s Labyrinth,”which made its American debut at the New York Film Festival in September and is produced in the director’s native tongue by Mr. Del Toro and “Children of Men” director Alfonso Cuarón, has more on its mind than vampire hunters and love-struck devil-spawn secret agents. As in his last Spanish-language outing, “The Devil’s Backbone,” here Mr. Del Toro achieves and sustains a remarkable level of film savvy and visual sophistication.

Also as in “The Devil’s Backbone,” Mr. Del Toro seeks to ground, contrast, and elevate the more heady and fanciful qualities of “Pan’s Labyrinth” in the grim realities of the Spanish Civil War. He is not entirely successful. Though the fantasy side of Ofelia’s saga fairly throbs with near psychedelic detail and depth, the supposed “real world” characters — a weak-willed mother, a uniformed sadist stepfather, a sincere and kindly doctor, heroic partisans, etc. — are mostly two-dimensional and seem to have been cribbed from other, less ambitious movies.

The earthbound tension that escalates as Ofelia rushes headlong to a split fate in two worlds also requires more suspension of disbelief than any of the magical chalk-drawn portals or menacing monsters of the storybook half. Did frisking prisoners end with the Spanish Civil War’s official hostilities in 1939? Do finger-pointing letters only come into existence at moments of plot crisis? Is the rusty lock protecting all-important food and ammunition stores only breachable by incriminating keys rather than with a few well-placed hammer or gun-butt blows?

It’s a tribute to how lovingly crafted and ruthlessly paced much of “Pan’s Labyrinth” is that the answers to these questions don’t really make much difference in the long run. Even a ring of sympathetic partisans seemingly paralyzed by post-climactic group poignancy in the aftermath of an ultimate and tragic act of heroic martyrdom doesn’t seem as corny as it did in “The Guns of Navarone” or any of dozens more World War II melodramas.

“Pan’s Labyrinth” succeeds on the merits of its cast (Ms. Baquero, Mr. Jones, and a particularly disturbing blind demon creature are standouts) and on the strength of Mr. Del Toro’s evident growth as a populist filmmaker committed to risking a few tears in the service of polished and personal genre storytelling. It is the best storybook-plumbing fantasy film I’ve seen since P.J. Hogan’s criminally maligned 2003 adaptation of “Peter Pan.”

Unlike “Peter Pan,” a sneakily grownup movie misguidedly marketed to children, “Pan’s Labyrinth” bears a well-earned R rating. Unless parents relish the idea of spending every night into the foreseeable future trying to persuade their kids to stop crying and go to sleep, they should put off exposing their early and preteen children to this equally lovely and gruesome film until they themselves have grown up.