In a China overrun by invaders and British selling opium, the last of the old emperors, a were-dragon now demoted to running a sky-pirate band, has just died. His only descendants are his true son, Wen, an opium addict, and the daughter of his favorite concubine, Red Jade. Although the offspring of an English beauty captured as a prize long ago, this intelligent and spirited daughter, and were-dragon, was loved immensely by the old emperor. He included her in much more of his activities than any normal woman would be, and she in turn ensured that her opium addicted brother was kept out of his way. But with the old emperor's death and Wen's retreat into opium dreams, Red Jade is thrust into acting as the leader of the sky-pirate band.

When Zhang, the old emperor's second in command, comes to Red Jade with the tale of the rubies and his plan to take control of them in order to restore the emperor to the Chinese throne, she feels she has no choice but to concur. In the course of the battle in the carpetship, Zhang manages to capture one of the rubies but then flees. Red Jade seeing that the carpetship is doomed to crash unless Nigel stays alive long enough to get to port, partially heals Nigel, and their connection begins.

Back aboard the sky-pirate barges, Wen's Third Wife, a member of the Fox Clan, is extremely unhappy that he remains an opium addict and totally uninterested in his emperorship and her. She encourages Red Jade to accompany her to an oracle, who foretells the different paths the two young women must take in order to cure Wen and to restore him to the Chinese throne. The chapters alternate between each of these paths until all can be resolved.

These were-dragons are Chinese, with Chinese features and attributes. Much of the underlying mythology is Chinese, with an oriental perspective on the various hells that await those who do not deserve to ascend to heaven. The method for enabling Nigel, the aristocratic Englishman, to camouflage himself while in China is also inherently Chinese, providing the internal consistency that is the mark of a fully conceived fantasy world-view. This is a fantasy tale filled with were-folk, a very strange set of flying vehicles (from flying carpets to flying Chinese junks), and oriental magic. But at its Heart and Soul, this story is a romance, in all the meanings of the word.