"The Other" wasn't a ghost story. It was a mental illness story. As it states in the book, mental illness runs in Perry family.
I read the book, which explains everything. This contains SPOILERS. But here's what happened, for anyone who wants to know.
Holland and Niles Perry are twins. Holland is older by a few minutes. They're twins with different birthdays (Niles is born after midnight). Holland's birth is very difficult but Nile's delivery is smooth and easy.
Holland grows up to be a sociopath. He's a thief, he tortures/kills animals, sets fires and by the age of 12 has committed 2 murders (he drowns a child and pushes a heavy trap door on his own father, smashing his head). He's well on his way to being a serial killer, although that term hadn't even been invented yet. Niles, on the other hand, is sweet, kind, thoughtful, loving, spiritual...and completely dominated by his brother.
Their grandmother Ada is a mystical Russian woman who teaches them "the game." The game involves using imagination and projection to temporarily "become" something other than yourself, like a bird, or a flower. Holland isn't much interested but Niles gets very, very good at playing the game.
On his 12th birthday, Holland, up to his usual tricks, hangs Ada's cat in the well, but loses his footing and falls into the well, killing himself also. The shock of losing his brother causes Niles to briefly. He eventually comes back to reality but is so crushed by grief that Ada, wanting to ease the pain of her "douchka", suggests he use "the game" to have his brother back. So Niles conjures up Holland by playing the game. He talks as if Holland were still alive, saying "Holland and I are going to...." or "Holland wants to"...it's bizarre and unhealthy but apparently the Perry family is willing to let Niles have his delusions. Ada figures he'll grow out of it, but she's very wrong about that. And she later comes to deeply regret suggesting to Niles to use the game on Holland.
While in bed, he hears the family talking about The Ring. The Ring is a gold ring with a peregrine on it. It was their father's. Holland had always coveted it and it may have been one reason why he killed his father; to gain possession of the ring. The family decides to leave the ring on Holland's finger and have it be buried with him. But Niles comes downstairs where Holland is in the coffin and plays the game on him; Holland tells Niles to take the ring. Niles has to cut the finger off with some rose shears to get it. He needs the ring to help him play the game on Holland, I suppose. He also keeps Holland's finger; he stores these macabre items in a Prince Albert tobacco tin.
Holland died in March. It's now summer, and Niles is in full "game" mode. Bad things start to happen. His cousin Russell's rat is poisoned. Russell is later killed in a mysterious accident. A sweet old lady dies of a heart attack after a cruel prank is played on her. His mentally frail mother, after finding the ring and the finger, get pushed down some stairs leaving her mute and paralyzed. And the baby of his adopted sister Torrie disappears one night. In playing the game on Holland, Niles does the things that Holland would be doing if he were still alive...like killing animals and human beings and being totally destructive.
Ada finally realized that all these things are being done by Niles when he is playing the game on Holland. She tries to get Niles to admit Holland is dead, but Niles will not accept it. She tells him that there is to be no more game. And she asks him where the baby is. And he screams "Holland knows! Ask Holland!" She realizes that "he would never give it up, this incredible, this most monstrous delusion, these REMAINS he was obsessed with. It would be with him for as long as he lived. She could see that now. And this outburst she had just witnessed, so unlike HIM, but so like...the Other...it was almost as though..."
