A group of friends sit around the fireplace of an old house in 1890s England, telling ghost stories. One of them starts telling a true story about two children. It is about a girl who accepts as governess to a boy and a girl at Bly. The previous governess died and the children are in the care of the housekeeper. There is one condition: she cannot contact him at any time and must deal with all problems herself.
At Bly the governess meets a beautiful eight-year-old girl, Flora, and the housekeeper Mrs. Grose. The boy, ten-year-old Miles, will return from school in a few days. The night before his arrival, the governess receives a letter from the headmaster of his school refusing to allow Miles to return to school after the summer holiday. Once at home, Miles seems to be just as beautiful and angelic as his sister and, for a time, the governess is very happy.
One evening, walking in the park , she sees a man in one of the towers of the house. At first she thinks it is the uncle of the children but then realizes it is a stranger. The housekeeper says that the man is Peter Quint, the uncle’s former valet, but Quint is dead. Mrs. Grose tells her that Quint spent a great deal of time with Miles and asks the governess to protect the children.
Many ghostly apparitions occur both of Quint and of the previous governess Miss Jessel. The governess is certain that the children meet with these ghosts in secret. She thinks the ghosts want to possess the children and lead them to their deaths. The governess decides to write to their uncle, but she doe not post the letter. Flora starts being ill. The governess sends Mrs. Grose and Flora by coach to the uncle immediately, and plans to stay alone with Miles who dies in her arms