Peter lives in Neverland, a small, magic-filled island paradise surrounded by many smaller islands. He shares this island with many other creatures magical, mundane or intelligent – or any combination of the three. There are fairies, pirates, mermaids, children, trolls… anything that might provide an interesting adventure is to be found on Neverland eventually.
Peter created the world of Neverland from his imagination, and sustains the existence of it and everything magical within it simply by believing in them. It has existed this way for a very long time – how long, he's not sure, and he really doesn't care. With the life that Peter lives, time is meaningless.
The magic of Neverland responds to many of Peter's whims, fears and desires, though the effect isn't nearly as extreme as it used to be. Early on, shortly after Neverland was created, parts of the landscape would shift, change, or even disappear all together as Peter remembered and forgot them. It was far too chaotic for anyone's tastes, and the fairies of Neverland gathered in their small kingdom of Tintagel and created the Neverscroll.
The Neverscroll was a magical blueprint of Neverland designed to solidify its geography once and for all. The images on the map were linked to the landscape, and once drawn, it could only be changed on one day every century. While this greatly improved life on the land, it also created a great weakness for Peter. Because Neverland was so closely linked to his mind, body, and spirit, drastic changes to the scroll affected him directly. Deliberately erasing parts of Neverland could cause him extreme pain and distress.
The Neverscroll wasn't the only magical item designed to keep Neverland running smoothly. There was also a magic clock created to keep time running at a steady, normal pace. Without it, time in Neverland would become as chaotic as Peter's memories and imagination.
However, just because Peter's subconscious could no longer drastically change the island didn't mean he had no control over Neverland anymore. Peter is deathly afraid of growing up, and absolutely refuses to do it. As a result, he stays eternally youthful, both in body and mind. He controls this limit himself, albeit subconsciously. If Peter ever made the decision to grow up, the spell would lift and he would grow.
Somewhere along the line, Peter befriended a fairy by the name of Tinker Bell. She fell in love with him, and often grew jealous of any women who also got close to him.
At some point, Peter made a habit out of leaving Neverland to search for children who could join him for adventures in Neverland. The boys he brought back lived with him in his Underground Treehouse, and they banded together, Peter dubbing his new followers the “Lost Boys”. He and his newfound friends had many adventures together, but the Lost Boys weren't the only outsiders to find their way to Neverland.
One day, a pirate ship appeared in Neverland – the Rake, captained by the infamous, nefarious, one-eyed Captain Jasper “Patch” Hook. Captain Patch and his crew terrorized Neverland for quite some time, though he was eventually killed – how, it's not known, but his spirit could not peacefully pass on and bound itself to the chest of Patch's pirate treasure. To ensure Patch would never terrorize Neverland again, the chest was hidden away in a cave.
All was well in Neverland for quite some time after that, until a hurricane stirred up and brought another ship to the shores of Neverland. This ship was the Jolly Roger, captained by Patch's younger brother, James Hook.
By this time, Peter and the Lost Boys had already forgotten about Captain Patch. Peter was excited to see a pirate ship in Neverland, wondering what kind of new adventures they might bring to Neverland. However, the vicious Captain Hook captured a handful of Lost Boys and pressed them into service. When Peter found them and tried to set them free, a fight broke out between the Lost Boys and the crew of the Jolly Roger, leading up to a moment where Peter mistakenly believed his friends had been killed. In a fit of rage, Peter grabbed Hook's sword. The Captain charged at him but Peter swung down, lopping Hook's hand clean off. Peter threw it into the sea, where it was eaten by a crocodile.
When Hook recovered, he swore vengeance against Peter for the loss of his hand, and Peter was all too eager to accept Hook as his mortal enemy. The two clashed regularly after that, engaging in battle whenever they crossed each other's paths. The rivalry extended to the Lost Boys and the rest of the Pirates as well, and soon Captain Hook and his crew became some of the most feared people in all of Neverland. Hook's vendetta against Peter continues to this day.
Somewhere along the line, Peter brought Wendy and her brothers, John and Michael, to Neverland. Despite her not being much older than him, he declared Wendy the mother of the Lost Boys, and she was charged with telling them stories and trying to keep some kind of order in their lives. Peter loves his mother dearly and will often do as she says, even when he doesn't want to, because he knows that's what mothers are supposed to do. He often tries to impress her with gifts and tours of Neverland, and loves the attention she gives him in return.
Wendy, Michael and John often accompany Peter and the Lost Boys on their various adventures throughout Neverland.
On one occasion, Hook managed to get hold of the Neverscroll, the map that controlled the landscape of Neverland, on the one day that it could be changed. Once he realized what kind of power he now possessed, Hook began erasing Neverland bit by bit. This put Peter through unimaginable pain, leaving him doubled over on the deck of the ship and crying out in pain. When Neverland was almost completely erased, Peter could barely move or think. Wendy managed to get hold of the Neverscroll and prompted Peter to remember Neverland bit by bit, redrawing it as he did so, quickly restoring the land and Peter.
On another occasion, when Peter threatened Captain Hook with certain death, Captain Hook managed to talk him down by taunting him. Hook flaunted his adulthood, claiming that he did not fear death because he had lived a full life – something Peter could never accomplish, because he is “a pathetic creature, forever locked in the self-serving egocentricities of childhood.” The reverse-psychology worked far better than Hook ever could have hoped.
Not to be outdone, Peter decided in a huff that he could grow up, after all – a decision that lifted the magic keeping Peter eternally young. Peter began to become more cynical, criticizing the senselessness of a house designed for flight and scoffing at the thought of pretending to eat. In a matter of hours he had grown into his late teens and stopped believing in magic all together – Neverland included.
Neverland began to deteriorate rapidly. Not even the faith that the Lost Boys and the pirates had in it was enough to sustain it. The forest, the beaches and the ocean began to fade as Peter grew older and older. He was a middle-aged man by late afternoon, lost and confused because he couldn't remember anything nor make sense of his surroundings. As he reached old age, becoming a frail, withered man, Neverland disappeared all together, leaving its last few inhabitants floating in an abyss of nothingness. Tinker Bell sought the old man out and spoke with him, reminding him of his childhood and begging him to believe once more. His faith in her gave her enough magic to concentrate into her tears, which quickly restored his youth and his faith – and all of Neverland along with it.
The adventures continue still, and Peter's days are filled with fun and danger from pirates, monsters, even his own mistakes from time to time. One one particular boring, uneventful day, while Peter is exploring the forests of Neverland, he hears the Call to Nautilus, and Wakes.
Peter is, on the surface, very friendly and amiable. Though wary of those he perceives as adult, he's quick to befriend anyone who's up for a game or a story – particularly if they butter him up with praise first. Peter is very vain and self-centered; He's got an ego the size of Neverland and the reputation to back it up. The fairies adore him, the Lost Boys idolize him, and the pirates, particularly Hook, believe he is worth the effort to try and kill time and again. Peter thrives on attention of any kind, positive or negative.
Despite his ego, he does genuinely try to be kind to his friends, loved ones and allies, and though his acts of kindness sometimes carry attention-seeking undertones, he truly hates to see his friends hurt or sad. However, Peter has trouble empathizing with others, and often can't understand why his friends are upset or why they can't just get over it.
His issues with empathy could possibly be linked to his chronic memory loss. Peter's forgets almost everything eventually, especially once they stop being relevant. Though Captain Patch had terrorized Neverland some time ago, when his ghost returned to haunt the island Peter didn't recognize him at all – out of sight, out of mind. He'll forget entire adventures had ever happened, particularly if they're sad or painful. Because he forgets his mistakes, he can't learn from them, and because he can't remember many sad experiences of his own, he can't identify with his friends when they're upset. His memory loss is staggered and gradual, so he does not notice when he loses one. The memories aren't gone forever, as old ones might pop up from time to time, but once they're forgotten Peter finds them very difficult to recall.
Because Peter can't learn from past mistakes, he often has trouble realizing that actions have consequences, and will often act without thinking. Combine this impulsive nature with his narcissistic attitude and lack of empathy, and it turns out that Peter can be quite a little brat… to put it lightly. His primary motivation in everything he does is having fun. He hates being bored more than anything, and his view of what's fun is the same as most children's. He loves to explore, run, climb, fight, play pretend, anything that keeps both his mind and hands occupied – and he's certainly not above inconveniencing others to get what he wants. Particularly not adults. Peter is willing to steal, bully, tease, goad and play cruel pranks if he thinks it'll be good for a thrill or a chuckle. He doesn't see these actions as hurtful — he assumes that because he's having fun, everyone else is, too.
Peter is very accustomed to getting his way, and indeed in a place like Neverland, it's hard for him not to. However, on the off chance that someone manages to put him in his place, he'll often fight or throw a tantrum, or take out his anger or frustration on someone else. He is, after all, a child.
Peter is terrified of growing up. He can't imagine why anyone would ever want to. At best, he pities any adult he encounters because he knows they'll never have it as good as he does, now that they're burdened with responsibility and wealth and social standing. At worst, he'll see the adult as a heartless monster such as Captain Hook who left all of his kindness behind in his childhood.
When Peter encounters those he deems villainous, like Captain Hook, his fighting is no longer playful. When Peter is serious about fighting, he can become downright vicious. He has few reservations about killing. He understands what it means on some level; He's been shown to become very upset at the thought of one of his friends dying. However, he's voiced his intent to eventually kill Captain Hook on multiple occasions and has even attempted it. Fighting is a thrill for him, as are mortal danger and very close calls. While the term is never used to describe him, for all intents and purposes he's an adrenaline junkie.
Peter sees his life as one great big game, one that will later be told as a great story. In his own eyes, no matter what role he decides to play, he's always the star and the center of everyone's attention.
- Flight - With the aid of pixie dust, Peter can fly through the air just as easily as he can walk. Tinker Bell can remotely take this power away.
- Eternal Youth - Peter cannot grow up, neither physically nor emotionally. His chronic forgetfulness plays a large part in this, though it's not stated whether his memory issues are caused by the Eternal Youth spell, or something else. Most of his experiences are eventually forgotten, meaning he can't learn from past mistakes and thus remains perpetually in an egocentric, childlike frame of mind.
- Swordsmanship - Peter is excellent at close combat, both in flight and on the ground. He fights with a small dagger, and has taken on the various pirates in sword fights and come out on top.
- Connection to Neverland - Peter sustains the entire island simply by believing it exists, and it's this same belief that keeps the fairies alive and keeps the magic on the rest of the island. As a result, if anything happens to him or he loses faith, the island will quickly decay before disappearing completely. The reverse is also true. If anything drastic ever happened to Neverland, it would hurt Peter both physically and mentally.
- Inter-dimensional Travel - Neverland can't be reached by traditional means of transport. However, Peter can travel back and forth between Neverland and the “Real World” at will, and ferry others with him if he so chooses.
- Time Travel - On at least one occasion, Peter was able to travel into the future simply by wanting to go there and flying to it, presumably with the same power he uses to cross realities. However, this was an incredible strain on him and he lost almost all of his memories as a result.
- Mimicry - Peter can imitate Captain Hook's voice with alarming precision, and has fooled his crew multiple times. With enough practice, he can imitate quite a few other voices as well.