Northern Lights and The Subtle Knife, the first two volumes of Philip Pullman's trilogy, His Dark Materials, earned him a place in the firmament of children's literature. He was the genre's bright, unfallen angel. Modelling his trilogy, as he often said, on Milton's Paradise Lost, he blurred distinctions between writing for children and writing for adults, and between genre fantasy and fiction of general appeal.

Pullman embraced a great sweep of ideas: considering the nature of the soul, the idea of sin and the theory of quantum physics. He made the abstract concrete, bringing these complex ideas to life in the form of tangible images: daemons in animal form that were bonded to human beings; dangerous Dust that coated the earth with evil; and parallel universes that emerged when chance took different directions. Not to mention page-turning plots and a rich cast of fantastical characters: armoured bears, beautiful witches, fatal spectres and cliff-ghasts among them. Furthermore, The Subtle Knife (1997) ended leaving readers gasping to find out what happened next. This third volume comes out in an atmosphere of breathless expectation and high hopes.

The Amber Spyglass suffers to some extent from what preceded it. It has to build on the extraordinary edifice that Pullman has already created. It is too much to recap the plots, but the third book has at least to remind the reader of what has gone before - it cannot stand alone. We need to understand the workings of the alethiometer, a hand-held machine, read telepathically, which tells what might happen in the future, and of the subtle knife, which can cut entrances from one universe to another. We have to remember, too, the parentage of the heroine, Lyra, the abandoned child of the powerful Lord Asriel and the villainous beauty Mrs Coulter.

Pullman's book begins, then, by going back even as it goes forward. It takes a while to place the reader where the story left off, at the same time as introducing new developments: Lyra is kept in a drugged sleep in a Himalayan cave by her mother, and Will, the other child at the heart of the trilogy, is in the care of a couple of gay angels (not in the Miltonic sense of "Satan's gay legions"). Lyra does not wake until some 170 pages into the book, which is convenient because this is the time it takes not only for Will, but for the rest of the story, to catch up with her.

The story has an episodic quality, more Pilgrim's Progress than rolling narrative. There is, for instance, the episode of Lyra's reunion with Iorek Byrnison, the armoured bear, in order for him to use his blacksmith's skills to reforge the subtle knife when it is broken - a beautifully described operation, but uncharacteristic of Pullman in that it does not drive the narrative onwards.

The thrust of the plot is that the forces of Lord Asriel are gathering against the (evil) forces of the church, whose Authority must be overthrown to replace the Kingdom of Heaven with the Republic of Heaven. The book's message is that we have only one life and it is on earth, and that by being "cheerful and kind and studious and brave" we can make this earthly life a heaven. But this sits awkwardly with a creation that has made us believe in several parallel universes, and which can imagine so comprehensively the land of the dead. The theme of the book suddenly seems at odds with its method.

The core of the novel is Lyra's entry into the land of the dead in order to apologise to her childhood friend Roger, for whose death she feels responsible. And here the plot and writing take off with a terrifying power. All through the novel, there are no compromises in the writing for children: the book is weighted with epigraphs at the beginning of each chapter - from Milton, Blake, Spenser, Emily Dickinson - that resonate but do not specifically illuminate what follows. The language is as grandiose as the themes: a lake, for instance, gives off "mephitic vapours". And the horrors are unmitigated, from dead bodies that are eaten to harpies that rot and stink even as they live.

The Amber Spyglass sometimes reaches the heights of imaginative and emotional power that we have come to expect from this trilogy, but not throughout. Trammelled by its own aspirations, like Milton's Satan, it pays the price of overweening ambition.