In Thailand, Chongwai is welcoming his friends Ted, Ted's cousin May, his friend Kofei and Kofei's girlfriend April from Hong Kong. While on a tourist tour, they see an accident on the road, and when they return to Chongwai's home, they decide to tell ghost stories. Chongwai shows them a mystic book, The Ten Encounters, which describes ten ways to see spirits. They decide to play its game, which they can begin on any step. Once the game begins, they must finish it or forever be haunted by ghosts.
Chongwai reveals the history of where he got the book. One day when he took the wrong bus and got lost, he arrived at a book store to ask for directions where he encounters the book on the shelf. The owner takes the book from Chongwai's hands and tells him he must pay before reading it. The man offers him a discount saying how karma led him to that book and sells it to Chongwai for 500 Baht. The man tells Chongwai not to open to the last page or be forever cursed. During the night, a strange wind storm occurs and flips the book to the last page. In it, it reveals the book costs fifty Baht.
They begin the game on step three where they try the spirit glass game where only Kofei sees the ghost. The ghost moves the glass around until Chongwai's mother appears and scares them. Chongwai reveals to his friends his mother is a spiritualist. Afterwards they went to an intersection where they attracted ghost with the fourth method. Ghosts arrived where everyone but May was able to see them. May, frustrated by being unable to see ghosts, tells them to continue the game, even though everyone else is afraid to continue. They continue to method five where they are playing hide and seek in a forest with May being the seeker. May finds everyone except for Kofei, who as said in the book, is the missing person with the ghost. He is considered missing because the ghost covers Kofei's presence. May releases a black cat, hoping it will break the spell so they can find Kofei. They search around until they find the black cat dead at the tree on which Kofei urinated.
The next day, the police are called to search the forest for Kofei but to no avail. April tries step six and rubs the grave soil on her eyes. Her eyes fall out, replaced by red sun-like eyes. She falls unconscious where Chongwai's mother cleans the dirt off her eyes and tells her how close she was to the purgatory world. April's eyes are still intact because she did not have her eyes open with the dirt on long enough. Chongwai's mother tells his friends to leave before something bad also happen to them. April says she wants to stay and find Kofei, while her friends leave in fear. That night, April in tears, brushes her hair at midnight; then her fate becomes uncertain.
Ted and May continue their lives without mentioning the occurrence of what happened in Thailand. One day while May is in the subway, she finds an umbrella held by someone invisible. She sees it and runs away. On the bus home, her umbrella suddenly pops open. May then sees a basketball rolling back and forth. She steps over it until it becomes a head and bites her ankle. She screams and jumps, and the passengers on the bus tell her it is only a ball. On the way back to her apartment she sees the ball again. She tries to side step is but the ball follows her. Afterwards she starts running, and the ball outruns her. She stops, and the ball begins to be dribbled by an invisible person. She performs step nine, the peek-a-stoop to find a boy dribbling the ball. The boy performs the peek-a-stoop and reveals his rotting face to her. She screams and enters her house where the basket is thrown on the door and she calls Ted. While waiting for him, she receives a phone call about the disappearance of April.
Ted arrives and takes the elevator to the floor where May lives, encountering many ghosts on the way. He finds the ball May tells him about and kicks it, only to become possessed. As such, he seems to be pop breakdancing. A pair of breakdancers arrive and figure Ted is challenging them. After a breakdancing battle, Ted, still possessed, walks on the wall and stands on the ceiling. The dancers and viewers who have come to watch them dance leave after figuring out he is possessed. Ted, falls and regains regains normal consciousness. He grabs a girl who is in the hallway, tells her it is dangerous and to come with him.
They enter May's room, where she is wrapped in a blanket with two bug zappers where they talk. Ted asks where that girl he bought in is and she reveals he came in alone. Ted receives a flashback and plays his video camera of the recording of the accident which reveals the dead body of the girl he just brought. He perfects a peek-a-stoop and finds the girl and screams. They leave the house. The girl watches the film and realizes she is dead and crosses over to the other side in a blinding flash of light.
In the meantime, Chongwai is studying the curse that the book places on them and visits the book store. He finds the book and the pictures of the characters have been replaced by him and his friends. He finds out the person who sold the book is the one who is doing the curse. Before he gets to ask questions about it, his mother pulls him away and tells him that man and the curse are more dangerous than he thinks.
Ted and May return to Thailand to try and beat the curse. They figured if they completed the game, they can escape the curse. Thus begins step ten. Ted and May wear traditional Chinese funeral clothes and go to sleep. Before so, Chongwai tells them they have a limited time in the purgatory world and when they hear a bell, they must go into the light to return.
In purgatory, Ted and May encounter ghosts who surround them. They chase the ghosts away with their breaths, which seems to damage the ghosts in some way. They continue onwards and find the ghost who was covering Kofei. He reveals to them he has been waiting for over an hour for them, but they reveal he has actually been gone for a month. They become surrounded in great numbers until April breaks through and guides them to a safe place.
Ted, May, and Kofei hear the bell and they see the light. April says she does not and reveals that because she thought Kofei was dead and that step eight was a failure, she slit her wrist deeply and died. Kofei tells them he will stay here with April and tells Ted and May to go. The light begins to suck and push everything. Kofei pushes Ted and May to the light.
Ted and May end up on the mats where they were laid. Chongwai is nowhere to be seen. They enter the house only to appear at the hallway where they see two male teens playing with the haunted basketball. The teens kick the ball towards Ted and May, and they run right past the two. Ted and May touch each other and find each other to be solid. They are confused by what is happening.
Meanwhile the scene changes to Chongwai and his mother ringing the bell over the unconscious bodies of Ted and May. Chongwai's mother explains to him that the curse of the book was too powerful.
The movie ends with the bookkeeper selling once more an item of the cursed book to another teenager.