The narrative opens in London with Sherlock Holmes and Dr. Watson deducing the character of a country doctor from his walking stick. Dr. James Mortimer then presents a strange manuscript detailing a family curse involving a spectral hound that supposedly hunted down Hugo Baskerville in the seventeenth century. Sir Charles Baskerville has just died under mysterious circumstances on the bleak Dartmoor estate, and his heir, Sir Henry, is arriving from Canada. Holmes advises Sir Henry to proceed to Baskerville Hall while deploying Watson to observe the neighbours and protect the baronet.
Upon arriving in Devonshire, Watson encounters the desolate landscape, the escaped convict Selden, and various local residents, including the naturalist Stapleton and his supposed sister. Strange occurrences multiply: a warning letter is sent to Sir Henry in London, his boots are mysteriously stolen, and muffled sobs echo through Baskerville Hall at night. Watson discovers that the butler, Barrymore, is secretly supplying food to Selden on the moor, and later learns from Barrymore that Sir Charles had an appointment with a woman bearing the initials L. L. on the night he died.
Watson traces this woman to Coombe Tracey and learns she is Laura Lyons, who admits she wrote to Sir Charles asking for financial help but denies keeping the rendezvous. Meanwhile, Holmes secretly arrives on the moor, having deduced the entire plot and identified Stapleton as the true mastermind and a hidden Baskerville heir. Stapleton had purchased a ferocious hound and painted it with phosphorus to frighten Sir Charles to death and eliminate the succession.
The climax unfolds when Sir Henry walks across the moor at night. Stapleton unleashes the terrifying hound, but Holmes, Watson, and Lestrade intercept and kill the beast after a desperate chase. They rescue Sir Henry and discover that Stapleton's captive wife was abused for attempting to thwart his plans. When they pursue Stapleton across the treacherous Grimpen Mire, he loses his footing in the fog and is swallowed by the bog, ending the threat forever.
In the final retrospection, Holmes reviews the case in Baker Street, explaining how the clues converged, from the scent of white jessamine on the warning letter to the startling resemblance between Stapleton and the portrait of the wicked Hugo. The mystery is fully untangled, restoring peace to the surviving participants.
