It has been said that writer-director M. Night Shyamalan (2004's "The Village") got the idea for "Lady in the Water" after coming up with a spur-of-the-moment bedtime story he told to his children. It shows. The film, a modern-day fairy tale that mixes otherworldly beings and creatures within a real world setting, is overflowing with ideas and, to a point, applaud-worthy innovation. What begins as positively enrapturing, however, eventually loses its way as Shyamalan's convoluted, overbloated mythology takes precedent over any kind of thematic relevance he was attempting to inspire.

Cleveland Heep (Paul Giamatti) is a lonely superintendent who runs The Cove, a Philadelphia apartment complex. One night, while investigating the swimming pool after seeing something splashing around, he slips and knocks himself out. When he awakes in his apartment, he discovers Story (Bryce Dallas Howard), a frightened, ethereal young woman who clearly doesn't belong in her surroundings. A Narf (translation: sea nymph), Story very much wants to return to an underwater place she calls the Blue World, but seems to have a bigger purpose to fulfill that even she herself does not quite understand before she can leave. With a deadly Scrunt (translation: an evil, wolf-like beast covered in grass) lurking outside that will not let her escape with her life, Cleveland must piece together the puzzle of Story's mythology-heavy existence if she is ever to find her way back to her own world. To do so, he seeks the help and guidance of his wide-ranging, ethnically diverse tenants, some of whom unknowingly hold the key to Story's survival.

There isn't a doubt in my mind that M. Night Shyamalan is one of the great cinematic artists of our time. A visionary filmmaker who could make the sight of paint drying riveting through his flawless handling of mise en scene, Shyamalan has time and again told commercially viable and original stories even as he has strove to find deeper timely meanings in both them and his internally conflicted characters. 1999's "The Sixth Sense," 2000's "Unbreakable" and 2002's "Signs" were great movies and some of the more emotionally and thematically ambitious Hollywood productions of the last ten years. 2004's "The Village" and now "Lady in the Water" have marked an alarming downward spiral for Shyamalan. Both pictures hold many of the same traits as his earlier ones, but aren't as tightly woven, presenting gangbuster setups that lead toward startlingly disappointing and jumbled anticlimaxes.

If "The Village" culminated in an admittedly savvy plot twist that felt more like a cruel trick on the audience, "Lady in the Water" simply decides to end before a payoff occurs. Taken as a dark bedtime story to tell to children, the film is too slow-paced and incessantly talky to entertain that young demographic. Meanwhile, the story quickly grows too ludicrous and is not nearly scary enough to win over older viewers.

There is one scene, involving Cleveland and Story's first confrontation with the monstrous Scrunt, so nerve-rattlingly intense and frightening that it elicits goosebumps. Otherwise, "Lady in the Water" figuratively drowns in exposition. For a long time, these dialogue-intensive scenes work as Cleveland investigates the fairy tale that Story seemingly derives from and ingratiates himself in the lives of the apartment tenants in the process. Alas, the promise that audiences will be rewarded for paying close attention with an electrifying, revelatory third act is not to be. The finale is flat-footed, underwhelming, bewilderingly simplistic, and narratively strained, its cobbled-together parts never forming a coherent or expressively resounding whole. Unlike Shyamalan's previous works, which had unmistakable humanistic intentions grander than the basic premises suggested, "Lady in the Water" concludes with a big "huh?" that leaves one questioning what the point was.

Cleveland Heep is an unconventional and unlikely hero—he is downtrodden with a stutter and tortured by a painful past that has left him closed-off to the outside world—which makes him all the more dynamic. Paul Giamatti (2004's "Sideways") is excellent in the role, giving Cleveland a voice and personality that a lesser actor wouldn't have been able to believably pull off. With that said, Cleveland's personal arc is unconvincing, not because of Giamatti but through the fault of a screenplay that doesn't build his relationships with Story and the quirky tenants to the meaningful level intended. These supporting characters are supposed to act as catalysts who aid in healing Cleveland from the inside out, but this important story thread is undermined by all the implausible fantasy-centric chitchat.

As Story, Bryce Dallas Howard (who had a better part in "The Village") is faced with a difficult character who is supposed to be angelic, sympathetic and not of this world. Howard pulls it off with little dialogue, and expertly personifies the fear of a being out of her element and unsure of her fate. Of the actors playing the apartment dwellers who make up the rest of the cast—the film never once journeys outside of the The Cove's gates—a few stand out. Bob Balaban (2005's "Capote") relishes playing smarmy, know-it-all film critic Harry Farber, who treats everything in life like a plot point in a movie, and Cindy Cheung is an exquisite and very funny scene-stealer as Young-Soon Choi, a free-spirited college student who gets caught up in the Narf mythology after translating the fairy tale to Cleveland that her Korean-speaking mother tells. M. Night Shyamalan gives himself the sizable role of Vick Ran, an aspiring writer living with his sister whom Story seeks out, but this is one case where the director's pretentiousness shows its face. Shyamalan is occasionally stilted, and his every appearance calls attention to itself.

As cryptic and inaccessible to mainstream audiences as anything Shyamalan has made since before "The Sixth Sense," "Lady in the Water" is almost barren of the chills and excitement necessary to offset its expository nature. The film is thick with atmosphere in the exterior sequences—the cinematography by Christopher Doyle (1998's "Psycho"), prevalent in eerie blue hues, and music score by James Newton Howard (2006's "RV") build a slick, threatening mood and sound—but it is at the mercy of a sloppy, exceedingly silly mosaic that fails to pinpoint its ultimate aspirations or meet expectations. For all of the endless prattling on by Cleveland and the other tenants about who the "Lady in the Water" is and why she has walked into their lives, the viewer is still wondering with frustration those very things by the end.