Little could James Matthew Barrie have known, when he first introduced the character of Peter Pan in his 1902 book "The Little White Bird," that the naif waif would go on to become one of the century's most beloved literary characters, captivating not only generations of readers but theater patrons and filmgoers as well. Barrie himself helped grow the phenomenon by further penning the popular stage play in 1904, a novella in 1911 and even a screenplay adaptation for Herbert Brenon's 1924 silent. It's the two musical adaptations, however, that have proved most enduring--the 1953 Disney animated classic and the 1954 Broadway musical directed by Jerome Robbins and starring Mary Martin (more recently revived with former Olympic gymnast Cathy Rigby). So precisely how does the new live-action "Peter Pan" fit into all of this? Remarkably well, actually, in view of the expectations surrounding it.

Co-written and directed by Australian P.J. Hogan ("My Best Friend's Wedding" and "Muriel's Wedding"), the new Universal/Columbia co-production of "Peter Pan" is remarkably faithful to its Edwardian roots, the first such adaptation to convey the magic, wonder and whimsy of Barrie's immortal prose in the sense that Barrie intended. On the other hand, fans expecting a frothy family musical will be sorely disappointed.

Effectively seizing the baton from Lewis Carroll's Alice, Barrie's Pan helped launch an entire genre of fantasy-based Edwardian children's literature without which there would surely never have been either a Mary Poppins or a Harry Potter. It's natural, then, that Hogan's "Peter Pan" hews to an old-fashioned aesthetic--it looks, sounds and feels like a movie that might have been made in the mid-'60s: visually vivacious, fearlessly sentimental, morally upstanding. It also rightly places Peter where he belongs in the character hierarchy--behind Wendy Darling. For it is Wendy, played magnificently by newcomer Rachel Hurd-Ward, who convincingly transports audiences beyond the film's contrasting worlds of industrial London and magical Neverland and into the hearts and minds of children struggling to reconcile the mirth of youth with the inevitability of adulthood. Bearing a striking resemblance to a young Kate Beckinsale, Hurd-Wood is a remarkable discovery, a young actress of such exceeding magnetism that she often makes the magical Peter seem ordinary by comparison. Unfortunately, a crucial bit of miscasting magnifies that ordinariness in unintended ways that do not particularly benefit the film. The lone American in a mostly British cast, Jeremy Sumpter ("Frailty") looks the part, but lacks the charisma and presence to keep pace with his European co-stars, plagued by a distracting lisp and a nagging inability to match their impeccable elocution.

Thankfully, Sumpter is really the film's only serious misstep. Jason Isaacs, playing the traditional dual-role of Mr. Darling and Captain Hook, is magnificent, closely followed by Richard Briers' delicious Smee and the wonderful French actress Ludivine Sagnier ("Swimming Pool," "8 Women") as a scene-stealing Tinkerbell. Olivia Williams as Mrs. Darling, Lynn Redgrave as Aunt Millicent and Harry Newell and Freddie Popplewell as Wendy's brothers, John and Michael, only further sweeten the confection.

A more obvious recent comparison than even the Disney film will surely be Steven Spielberg's 1991 semi-sequel "Hook," a coolly-received effort that was nonetheless widely acclaimed for its production values. Impressively, Hogan's "Peter Pan" surpasses Spielberg's, aided by the very man who edited "Hook," Michael Kahn (working here with co-editor Garth Craven). Other technical contributions are similarly Oscar-worthy--from Donald McAlpine's photography to Roger Ford's sterling design effort and James Newton Howard's soaring score.

Shortcomings notwithstanding, it's an impressive and praiseworthy work which, with luck and some due broad-mindedness on the part of audiences, should ably join the pantheon of previous adaptations, honoring Barrie's legacy and returning a handsome and well-deserved sum to London's Great Ormond Street Hospital for Sick Children, to whom Barrie donated the "Peter Pan" rights in 1937. Starring Jason Isaacs, Jeremy Sumpter, Richard Briers, Olivia Williams, Lynn Redgrave, Ludivine Sagnier, Rachel Hurd-Wood, Geoffrey Palmer, Harry Newell and Freddie Popplewell. Directed by P.J. Hogan. Written by P.J. Hogan and Michael Goldenberg. Produced by Lucy Fisher, Douglas Wick and Patrick McCormick. A Universal release. Family/Fantasy. Rated PG for adventure action sequences and peril. Running time: 110 min