Richard Papen leaves his hometown of Plano, California for Hampden College in Vermont. He is accepted into the class of Classics professor Julian Morrow, who limits enrolment to a hand-picked clique: charming but secretive fraternal twins Charles and Camilla Macaulay; Francis Abernathy, whose secluded country home becomes a sanctuary for the group; Henry Winter, an intellectual with a passion for the Pali canon, Homer, and Plato; and Edmund "Bunny" Corcoran, a bigoted jokester.

Henry appears to have a strained friendship with Bunny, but they spend a winter break together in Rome. Richard takes a low-paying campus job and spends winter break in an unheated warehouse. He nearly dies from hypothermia and pneumonia, but is rescued and taken to the hospital by Henry, who returns early from Italy.

After winter break, tensions between Bunny and the group worsen. Richard learns the truth from Henry and Francis: during a bacchanal from which both Richard and Bunny were excluded, Henry accidentally killed a farmer near Francis's country estate. During the trip to Italy, Bunny discovered the truth by reading Henry's diary, and has been blackmailing the group since. No longer able to meet Bunny's demands, and fearing that he will expose them, the group resolves to kill Bunny. They confront Bunny while he is hiking and Henry pushes him into a ravine to his death.

The group struggles to maintain their cover, joining search parties for Bunny. Richard learns more about the bacchanal murder from Camilla; when they killed the stranger in plaid, his stomach was cut open, suggesting that it was not accident.

Charles develops a drinking problem and becomes increasingly abusive towards Camilla. In response, Henry arranges for her to move into a nearby hotel. Francis confirms to Richard that the twins are in a sexual relationship, and admits he has slept with Charles on a number of occasions and has suffered from panic attacks. Julian discovers a letter sent to him by Bunny, imploring him to help; instead of reporting the crime, he leaves the faculty.

Henry begins living with Camilla, which drives Charles further into alcoholism. When Charles is arrested in a drink-driving incident with Henry's car, Henry fears Charles will let slip their secret to the police. Charles barges into Camilla and Henry's hotel room and tries to kill Henry with Francis' gun. In the struggle, Henry gets hold of the gun and Charles accidentally shoots Richard in the abdomen. The innkeeper, hearing the commotion and gunshot, forces his way into the room. Henry kisses Camilla farewell and commits suicide with the gun. The police report concludes that, in a suicidal fit, Henry shot Richard.

With Henry's death, the group disintegrates. Francis attempts suicide and, though homosexual, is forced by his rich grandfather to marry a woman he despises; Camilla, caring for her grandmother, becomes increasingly isolated; Charles runs away from rehab with a married woman and no longer speaks to Camilla; and Richard, after recovering from his wounds, becomes a lonely academic with an unrequited love for Camilla. Richard sees Henry's death as having cut the cord that bound them, setting them all adrift. He meets Henry in a dream, and asks him if he is happy there. Henry replies: "Not particularly. But you're not very happy where you are, either."