Sam is about to propose to his girlfriend Libby, and his neighbours in Christmas Street all think they know the right way to do it. With their help - and sometimes hinderance - Sam gains a fiancée and the wedding planning begins.
Meanwhile, Sam's nine-year-old son Teddy and his friend Pari - with their constant companion Jack the street dog - are fascinated by the arrival of a mysterious new neighbour on the street who has rented the empty, run-down house. Their attempts to spy on her are thwarted by her staying indoors with the curtains drawn most of the time. But soon Christmas Street begins to work its magic and Millie is reluctantly drawn into street activities.
As Millie starts to relax into thinking she can have a different life, maybe even with Jasper, the local carpenter, someone turns up from her past to threaten that. But with all of the street looking out for her, Millie's Christmas will be filled with hope and promise.