Ray Peterson (Tom Hanks) and his wife Carole (Carrie Fisher) are very ordinary people living in a completely average sort of suburb, at least until the Klopek’s move next door. Dr. Werner Klopek (Henry Gibson) and the other Klopeks, Uncle Ruben and Hans (Brother Theodore, Courtney Gains) are reclusive, make strange noises at night, through out “suspicious” trash and bury who knows what in their backyard. Ray has taken vacation, which for him means not a trip but doing nothing at home, and along with paranoid neighbors Rick Ducommun (Art Weingartner), Ricky Butler (Corey Feldman) and Mark Rumsfield (Bruce Dern), decides to find out what they are up to. Speculation ranges from them being spies to running a satanic cult, and the flames are fanned when neighbor Walter Selznik (Gale Gordon) goes missing leaving behind only his beloved dog and his toupee. The neighbors root through the Klopek’s garbage, sneak into their yard at night and try to dig up evidence, and eventually break into the house, which Ray inadvertently blows up while he is still inside. Although Walter comes back alive, a final confrontation with the police and partly inside an ambulance reveals truths about the Klopeks.