Pinocchio, Royal Lyceum, Edinburgh <!-- none onestar twostar threestar fivestar -->

Whoever heard of a story based on a block of wood? That's the question the cast of Mark Thomson's new adaptation of Pinocchio asked the audience, before firmly deciding it would be infinitely for the best if everybody just went home. But a moment later the actors seemed bewitched, spinning and twirling around the empty stage, and the magic of Carlo Collodi's tale took hold because "some stories just need to be told".

Going back well beyond the familiar but far more recent Disneyfication of Pinocchio to Collodi's 1880s Italian original, Thomson - the theatre's artistic director, also responsible for this staging - carved a production of Pinocchio that was supple, colourful and never less than engaging.

The puppet himself came vividly to life in an energetic portrayal by James Anthony Pearson. His slightly gawky gait, and an expression of innocence and naughtiness, combined to make him a rather endearing creation. In fact, Pearson's boyish good looks recently landed him the role of another cherub-faced character, that of Bernard Sumner in the forthcoming film Control, based on the life of the post-punk singer Ian Curtis. On stage for nearly the whole time, from the moment Gepetto took his knife to the small tree trunk, Pearson spared nothing in terms of the energy he invested in the part. Anyone who suggested that his acting was wooden would have found his or her nose growing at an alarming rate.

From a length of rope that extended from Pearson's own nose into the wings, before winding on again further upstage, to a wooden pole that emerged stuck to his face, the incriminating proboscis was cunningly extended as the puppet's lies grew ever more extreme. And it was not only the legendary hooter that was visually enchanting. Robert Innes Hopkins's designs took us from Gepetto's charmingly skewed wooden workshop to a sunlit Italian piazza, and across stormy blue seas into the cavernous belly of a monstrous sea-creature.

Telling the story in a series of adventures, Thomson didn't shy away from the darker elements of Collodi's tale. When Pinocchio waved his burnt stumps in the air from behind the stove, it seemed as though Thomson was playing with fire in testing the nerve of his young audience. But Pinocchio's "father", Gepetto, was soon knocking up new legs to carry his mischievous puppet-son off on another escapade.

Another gruesome aspect of the tale was frankly exposed when the puppet, tricked by the swindling cat and smooth-talking fox, was left hanging upside down from a tree to die. The stranger who entices Pinocchio and his pal Lamp-wick to the Land of Dreams, where children are turned into donkeys, was all the more sinister for being played by a toady-voiced woman (Molly Innes) in a grotesque fat-suit. But for every scrape in which Pinocchio found himself, learning each lesson the hard way, there were lighter moments and even a few panto-style opportunities for the audience to add its voice. Some parts of the show were delivered in song, with Jon Beales in the pit underscoring the action and adding a whole range of evocative sound effects with tremendous gusto.

The hard-working company shared the 32 roles, giving the impression that the stage was peopled by a far larger cast. The Azure Fairy (Shonagh Price) was assisted by a camp poodle in Matthew Pidgeon, who transformed himself from flouncing fairy into a rough Green Fisherman, while Andrew Clark was a farcical Policeman and a wily Mad Dog. The moral of each adventure was delivered by sleight of hand, so that, in Pearson's portrayal, the puppet's emergence as a real, live breathing boy with a beating heart seemed inevitable.