How It All Goes Down
The story opens with a framing device—we find ourselves at a holiday party, where ghost stories are being told. One of the members of the party, Douglas, promises rather woefully to provide a chilling, real-life tale once a manuscript containing it arrives. The houseguests are all intrigued and excited—as are we, the readers. (The narrator is a little snide, though.)
Chapter One begins the proper "story." A nameless, young governess (our narrator) is hired by a dashing, rich, and rather odd man to be a governess for his niece and nephew who live at a country estate called Bly. The Governess sets out for Bly, with only the instruction that she is never to contact the uncle. At the house, she finds Mrs. Grose, a kindly housekeeper, and Flora, the younger of the children. Flora is an exceptionally beautiful and all-around wonderful child—too wonderful, perhaps.
Things are complicated when the Governess receives word that Miles, the older child, has been expelled from his school. We're not told why, but the school's headmaster sternly states that Miles will never be allowed back. The Governess wonders what the boy could possibly have done to receive such a verdict. Mrs. Grose denies that anything is wrong with Miles; when the boy himself arrives, his incredible beauty and charm convince the Governess that she was crazy to think that he could do any wrong.
Everything seems great for a little while, until the Governess sees a strange and menacing male figure on one of the castle's towers one evening. A few days later, the same stranger reappears just outside the dining room window, eerily looking in. The Governess is shocked by his return, and even more alarmed by the idea that he's not there for her—he's there for someone else. But who...?
The Governess and Mrs. Grose figure out that the mysterious figure is Peter Quint, a former servant of the children's uncle. The strangest thing is—Quint's dead. The Governess and the housekeeper make a pact to save the children from the ghost's evil influence.
This isn't the end of their troubles, though. Another ghost appears one day as the Governess watches over Flora. She's sure that the child also sees the ghost but pretends not to. The Governess is certain that this evil presence is that of Miss Jessel, her predecessor. What disturbs her the most is the possibility that Flora saw the ghost—but actively deceived her new teacher. Alarmingly, the next sighting is inside the house; the Governess sees Quint on a staircase, then a few days later, sees Jessel in the same place.
Things are getting scary.
The question of the children's innocence is still pressing. One night, the Governess discovers a weird little scene—Flora has snuck out of bed and is gazing out the window at someone on the lawn, who, in turn, is looking up at someone else on top of the tower. The mysterious person on the lawn is not in fact Miss Jessel, who the Governess expects, but is instead Miles. The boy excuses himself, but the Governess is even more convinced that something fishy is going on with the children and the ghosts.
From here on out, events escalate fast—the Governess's relationship with Miles grows more and more uncomfortable and strangely intimate, while he tries to use his power over her to get her to send him away to school again. Then, Flora goes missing one day, only to be found at the lake where Miss Jessel was first sighted. Once the girl is found, the Governess loses it and demands to know where Miss Jessel is. Upon saying this, the ghost appears...but only to the Governess. Flora denies having ever seen any ghost, and poor Mrs. Grose certainly can't see the spirit. Flora turns against the Governess for good.
It's decided that Flora and Mrs. Grose will leave Bly for London, where they will go to the children's uncle (to whom the Governess has already written). Unfortunately, the Governess's letter never got sent—it turns out that Miles stole it and burned it. Furthermore, we finally learn why Miles was asked to leave school, though we don't get any details beyond the fact that he said "things" to the other boys.
In the midst of this confession, the ghost of Peter Quint appears one last time outside the window. The Governess cries out at him, and Miles attempts to see the ghost—but he disappears. This seems like a triumph for the Governess…until she realizes that Miles has died in her arms.