The story is set during 1907–09 (with an epilogue in 1910), in a Swedish town. It deals with a young boy, Alexander (Bertil Guve), his sister Fanny (Pernilla Allwin), and their well-to-do family, the Ekdahls. The siblings' parents are both involved in theater and are happily married until the father's sudden death through a stroke. Shortly thereafter, their mother, Emilie (Ewa Fröling), finds a new suitor in the local bishop, a handsome widower, and accepts his proposal of marriage, moving into his ascetic home and putting the children under his stern and unforgiving rule. He is particularly hard on Alexander, trying to break his will by every means, something Emilie had not expected. The children and their mother soon live as virtual prisoners in the bishop's house until finally the Ekdahl family intervenes, urged by Emilie who has secretly been in touch with her former mother-in-law Helena and told her of their dire situation.
With help from an old friend, a Jewish antiques dealer, as well as some magic, the children are smuggled out of the house, but the Ekdahls' attempts to bribe or threaten the bishop into divorce fail. Emilie, by now pregnant, slips her husband a sedative and flees as he sleeps, after which a fire breaks out and the bishop is burnt to death. In the meantime, Alexander has met the Jewish merchant's mysterious nephew, Ismael Retzinsky, and fantasized about his stepfather's death – it is as if Alexander's fantasy comes true as he dreams it. The story ends on a mainly happy, life-affirming note, with the christening of Emilie's and the late bishop's daughter as well as the illegitimate daughter of Alexander's uncle, Gustav Adolf Ekdahl (Jarl Kulle); this fruit of the lustful man's affair with the nanny girl Maj is cheerfully adopted into the Ekdahl clan. During the festivities however, Alexander encounters the ghost of the bishop who pushes him to the floor, signalling that he will never be completely free of him.
Bergman intended the film to be his last feature, although he wrote several screenplays afterward and directed a number of TV specials. The film simultaneously documents many of Bergman's earlier star actors and a wide array of prominent Swedish film and stage actors of its era. Liv Ullmann and Max von Sydow who, as leading Bergman actors, are conspicuously absent in this respect, had been his original intended stars as Emilie and Bishop Vergerus, but Ullmann was eventually unable to join due to other work obligations, while von Sydow didn't receive notification in time, apparently through mismanagement by his American agent. Bergman instead recruited newcomer Ewa Fröling and Jan Malmsjö who is more widely known in Sweden as a highly gifted song and dance man, but who has also done many serious character parts on stage and on the screen. Bertil Guve, who gave a widely acclaimed performance as the boy Alexander, did not choose to pursue acting, but instead became a doctor of economics. However Pernilla Wallgren (later known as Pernilla August) who played the attractive nanny Maj went on to star in other films, including The Best Intentions which Bergman wrote (but did not direct), and Star Wars Episode I: The Phantom Menace as Anakin Skywalker's mother.
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