A beautiful young artist comes to Italy to take possession of the castle she has just inherited, and her art-restorer friend joins her for the night. They agree to shelter a troupe of carnival performers, and at dinner the leader drugs them in order to have his way with them (but passes the artist off to his lookalike brother, who becomes a beast). The friend leaves the next day, and the artist starts exploring the labyrinthine castle (this being one of those GU stories that takes place entirely within a house). She begins seeing the apparition of a ghostly girl, who (it turns out) was long ago killed by a curse that is on her family, a curse which involves the performers.
The artist, Catherine, starts to fall in love with the beastly brother, still thinking he is the same person as the wicked, cruel man, when in fact he is his kinder brother. She is helped a little by her housekeeper, a mysterious old woman who mostly tells her she must figure things out for herself. Catherine must break the curse by confronting the evil brother (wearing the clothes of the ghost girl, apparently), which will also save the gentle brother from turning into a beast all the time.
Leading up to the final confrontation, Catherine goes underground within the castle, and then is temporarily tricked by a cruel fraud. Once the adversary is defeated, she decides to follow the good brother back through the portal from which he came, into his own world.
If nothing else, this movie should be watched simply for the opening scene, of fire jugglers and other performers slowly emerging in the fog from the mouth of a giant stone ogre (this and other scenes were filmed in the Park of the Monsters, a 16th century garden full of monumental sculptures in Italy).