Borrowers, tiny folk not six inches tall, have been living beneath our floorboards, borrowing essentials they need to survive from us 'human beans' since award-winning children's author Mary Norton first wrote of their adventures in 1952. Indeed, Roald Dahl's BFG seems to have borrowed his name for us tiny folk from them!

Artistic director Paul Hart and his versatile company use every artfully imaginative means to bring them to boisterous life in Theresa Heskins' adaptation. She conflates Norton's books into one adventure, setting up the borrowers' precarious world in the first half, where curtains are mountains to scale and human beans an ever-present danger, for borrowers dread above all being seen.

Brave and caring dad Pod (warmly engaging Matthew Romain) discovers his daughter Arrietty has inherited his resourcefulness. So her mother Homily (delightfully down-to-earth Charlotte Workman) reluctantly agrees to let her go borrowing too. Nenda Neurer's bouncy adventurous Arrietty is a lovely role model for the spellbound schoolgirls in the audience. She's a bit too bold, so she is indeed seen – by a boy (sympathetic Frazer Hadfield). Happily, he's a friend in need who helps the family escape the ruthless cook and gardener (a gleefully evil double act from Natasha Karp and Ed MacArthur) who literally smoke them out. They emerge into a big wide world of fields as vast as whole counties and their adventures accelerate.

Designer Toots Butcher revels in the fun of creating the improvised dolls-house world, dominated by a huge watch doing clock duty and an abacus ladder, its dining table fashioned from a playing card with cotton-reel seats. Inspired props include a pull-along pet cricket, her glorious song provided by Anna Fordham.

Butcher's costumes, subtly suggesting post-war Britain, also seem to be improvised from borrowed items. The girls tie up their hair with rag topknots and curl papers, rope stands in for string for braces holding up loose trousers.

Tarek Merchant's jaunty imaginatively orchestrated score for these well-drilled and choreographed actor-musicians achieves perfection in "Cover's an Art" – the borrowers A-Z survival guide. It works neatly with David Gregory's appropriately amplified soundscape, which suggests how loud every sound is to tiny ears.

George Seal's atmospheric lighting, appropriately dark and mysterious, shimmers into welcome sunshine, helping the borrowers negotiate huge fields to seek shelter in a discarded boot – until stress-ball rain pelts borrowers and audience alike to the delight of excited young human beans.

There are messages – of tolerance – the boy engages with this tiny other, the big house's servants see only a tiny foe to be crushed or exploited, but they are exploited in turn. Country cousin Spiller (Macarthur again) teaches ‘vegetarian' Arrietty outdoor survival tactics - even beautiful bluebirds might be hunted for much-needed food. A big-hearted, inclusive, satisfying family show.

The Borrowers runs at the Watermill Theatre until 31 December.

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