In this film, Australian werewolves have evolved separate from the rest of the werewolf population. They are marsupials – the female werewolves give birth to partly developed offspring, which then makes its way to a pouch for further development.
Harry Beckmeyer (Barry Otto), an Australian anthropologist, has somehow obtained footage filmed in 1905 which appears to depict Australian Aborigines ceremonially sacrificing a wolf-like creature. Alarmed by the reports of a werewolf killing a man in Russia, he seeks an audience with the U.S. President (Michael Pate) to try and warn him that there is a widespread case of lycanthropy afoot in the world. The President is dismissive.
A young Australian werewolf named Jerboa (Imogen Annesley) runs away from her pack into the city to avoid her sexually abusive step-father Thylo (Max Fairchild). After spending the night on a park bench in Sydney near the Opera House, she is spotted in the morning by a young American, Donny Martin (Leigh Biolos). He is instantly infatuated with her and attempts to approach her. Jerboa runs away frightened and he chases her through the park before finally catching up. He offers her the female lead role in a horror film he is helping to make, Shape Shifters Part VIII. Jack Citron (Frank Thring), the director of the film, hires her immediately, praising her natural talent. Jerboa and Donny quickly fall in love and Donny takes her to see a fake werewolf film entitled It came from Uranus, in which a "werewolf" is seen transforming. Jerboa tells Donny that the transformation "doesn't happen like that", which leaves Donny puzzled. Later, after making love, Donny is curious as to why Jerboa refused to take off her top while they were together. He notices that Jerboa's lower abdomen is covered in downy white fur and what appears to be a long scar, but he does not question her about it. Meanwhile, a full moon has risen outside.
At the wrap party for the movie, Jerboa is exposed to strobe lights, which make her start transforming. She flees the party and is hit by a car. The doctors at the hospital realize that there is something very strange about Jerboa; she has striped fur on her back (like a thylacine), and a pouch. They also deduce that due to her high amount of hormones, Jerboa is pregnant from Donny.
Concurrently, Beckmeyer's father has disappeared in the Outback shortly after recording a film of tribal villagers apparently killing a werewolf. His investigation is short lived as three of Jerboa's sisters show up in the city disguised as nuns. They track her down, murdering anyone in the way, and take her back to their pack's hidden werewolf town, Flow ("wolf" spelled backward). Deprived of evidence of werewolves, Beckmeyer and his colleague Professor Sharp (Ralph Cotterill) spend the evening watching a visiting ballet troupe practice. However, they get to see the prima ballerina, Russian Olga Gorki (Dasha Blahova), transform into a werewolf to the horror of her troupe. She is captured and taken to a laboratory but quickly escapes, somehow making her way to Flow where the pack have been chanting to call her to be Thylo's mate (as Jerboa is pregnant). Jerboa soon gives birth to a baby werewolf.
Donny contacts Beckmeyer, informing him that his girlfriend was from Flow and takes off with him to find her. Jerboa smells Donny nearby and meets him at night. She shows him their baby boy and tells him about the impending danger and the family flee into the hills.
The next morning a government task force captures the werewolf pack, but not before having several soldiers killed. Beckmeyer enlists the help of Olga, who he is attracted to, to allow her and Thylo to be researched. After many surveys and investigations (including an incident where Thylo was tortured with strobe lights to make him transform) Beckmeyer starts to fret over the injustice done to the werewolves, including the U.S. Army hunting them in 1889, and so he frees Olga and Thylo. The trio escape into the Outback and eventually find Kendi (Burnham Burnham), Donny, Jerboa, and the baby. They are pursued by hunters but Kendi calls on to the spirit of their legendary phantom wolf and massacres them to ensure the safety of the family. He is cremated in a makeshift ceremony but the smoke alerts some soldiers who are still pursuing them. They are attacked by Kendi's skeleton who manages to hurt and scare them before being destroyed by one of the soldier's machine guns. At night, Thylo also calls unto the spirit and is transformed into a huge wolf who attacks the remaining soldiers before being killed by a bazooka blast that destroys the rest of the encampment.
At last, no longer being pursued by soldiers, Olga and Beckmeyer fall in love and together with Jerboa and Donny, hide and make a homestead at an idyllic riverside camp, avoiding human contact and raising their children in peace. After some time, Jerboa and Donny eventually move out, with the intentions of assuming different identities and the Beckmeyers remain behind raising their daughter and newborn son. Eventually, Harry is tracked down by Sharp and informed that all lycanthropes have been given papal amnesty due to the crimes committed against their kind and the Beckmeyers move back to the city. While teaching a class in Los Angeles and showing the reel seen at the beginning of the movie, Beckmeyer pauses to tell his class about Jerboa and how though he and Olga searched for her and Donny but never found them. At the end of the class he is approached by a young man who Beckmeyer notes looks familiar but cannot recognize. The young man introduces himself as Zack. He is Jerboa and Donny's son. He informs Beckmeyer that him and his parents are now living in Los Angeles and his mother is now the famous actress "Loretta Carson" and his father is now the famous director "Sully Spellingberg".
That night, Olga and Beckmeyer are watching a television award show in which Jerboa has won the best actress award. Her sisters are seen living in a cave in their half transformed states celebrating her win. As Jerboa accepts her award and tries to give her speech, the flashing cameras and stage lights cause her to start changing into a werewolf. This also prompts Olga to start her change much to her husband's dismay. Jerboa goes on the attack as her sisters howl in glee and Sharp is seen in his living room smiling deviously.
The final shot shows a picture of a thylacine, or Tasmanian tiger, a marsupial carnivore which was hunted to extinction by Australian farmers to protect their sheep as it was the inspiration for the film.Barry Otto as Professor Harry Beckmeyer
Imogen Annesley as Jerboa
Max Fairchild as Thylo
Ralph Cotterill as Professor Sharp
Leigh Biolos as Donny Martin
Frank Thring as Jack Citron
Michael Pate as President
Barry Humphries as Academy Awards Presenter
Carole Skinner as Yara
Brian Adams as General Miller
Christopher Pate as Agent
Dagmar Bláhová as Olga Gork
Burnham Burnham as Kendi
Steve Shaw as Horror Movie Actor
Bob Barrett as Policeman
Fred Welsh as Dan Ruggle
John Ewing as General Forster
In The Howling series, this film is considered a stand-alone film. Though Philippe Mora directed Howling II: Your Sister Is a Werewolf, this film features no references or characters from the previous two films. The werewolves in Howling III are also portrayed more sympathetically.
Mora had been unhappy with Howling II's story and how the producers added extra shots after he left, such as additional shots of breasts. Mora wanted to make a third film himself to make amends and raised the money himself with co-producer Charles Waterstreet.
The film was first released on DVD by Elite Entertainment in 2001. The DVD contained a widescreen print of the film, trailers, and an audio commentary by the director. The DVD has since been discontinued. In 2007, Timeless Media Group released another DVD of the film and a Blu-ray release. Both contained no bonus material and a pan and scan version of the film.
The film holds a 18% approval rating on the review aggregate website Rotten Tomatoes based on 11 reviews.