There's something strange about the area of London just north of Euston Road. The central part of the city comes to an abrupt end. There are the huge rail terminuses - King's Cross, St Pancras and Euston itself - but beyond them, who knows? Not the thousands who daily swarm to catch their trains, or drive the route between Baker Street and Angel. Unlike the stations it hosts, this part of London is not a destination. It's leftover territory, ignored by everyone except the people who live there.

Somers Town is where Shane Meadows has set his latest film, his first in London. As a Midlands man, it was a logical choice - the train from Nottingham, where he is based, gets in at St Pancras. It's also where one of the film's two leads, Tomo (Thomas Turgoose), arrives one morning, having just been released from care in his home town. He's a cheerful, articulate lad but has no job, nowhere to stay and no money. Out on the streets, he quickly gets in trouble, an easy target for the local kids.

Of course, Tomo is far from being the only one living a rootless existence there. Polish teenager Marek (Piotr Jagiello), whose father, Marius (Ireneusz Czop), works on the gigantic construction site from which the new Eurostar terminal will eventually rise, wanders around taking photographs and obsessing over a sweet French waitress in a local cafe. In the evenings he does the cooking and reads aloud from English newspapers while Marius corrects him. There's affection there, but estrangement too. Father and son are very different people: Marek, a self-conscious, gawky teenager; Marius, a hard-drinking man of the world.

Tomo and Marek's paths cross one morning in the cafe. Though initially wary of this strange English boy, Marek's defences are soon worn down by Tomo's honesty in demanding help and company. Pretty soon he's putting him up, stealing new clothes for him and vying with him for the affections of Maria (Elisa Lasowski), the waitress.

Somers Town shows how two characters - an extrovert and an introvert, one brash and one sensitive, both troubled - can find solace in each other. Looked at objectively, the lives they find themselves living are pretty bleak: more so for Tomo, whose family are completely out of the picture, than for Marek, whose father loves him, though they find it hard to connect.

But Meadows finds enough humour in the details that this isn't at all a depressing film. We feel - perhaps unrealistically - that Tomo, despite the odds being stacked against him, will be all right in the end. And in the meantime, we laugh along at his escapades.

Turgoose is best known for his role in Meadows's This is England, which was a hit with critics when it came out in 2006. He was hailed then as a natural - having had no acting training - and with Somers Town he proves the performance wasn't a fluke. His mischievous charm is the perfect foil to Marek's lonely introspection, and his deadpan humour and sense of timing are all the more impressive given that most of the scenes are improvisation-based.

Somers Town started out as a short film and it retains that simple, lyrical quality. Nothing of any great significance happens, but two people, both at crisis points in their lives, get to know each other and form a bond. It's basically a story about friendship and about how the big city doesn't necessarily grind you down; how loneliness can be defeated by human contact and how cultural differences can be transcended. They might seem totally different, but a Polish kid and an English kid are less strangers, we find, than a Polish kid and his dad.

The film closes with a dream-like section in full colour (up until then, it's entirely black and white). Some time has passed and Marek and Tomo are taking the Eurostar to visit Maria in Paris, leaving the completed St Pancras in all its polished glory. Reunited, they run around, play silly games, visit the sights.

It's an odd coda and leaves you with the uncomfortable sense that Meadows is engaging in a bit of wishful thinking: isn't the idea that Tomo, given the cards that life has dealt him, will live happily ever after just an impossible fantasy? Maybe, but perhaps one lesson we learn from this film is that joy and sadness aren't mutually exclusive. After all, even in the worst of times there are flashes of humour and hope. And it's these that, in the desire for "social realism", a certain kind of filmmaker often disappointingly leaves out.