In Nischindipur, rural Bengal, in the 1910s, Harihar Roy (Kanu Banerjee) earns a meagre living as a pujari (priest), but dreams of a better career as a poet and playwright. His wife Sarbajaya (Karuna Banerjee) takes care of their children, Durga (Uma Dasgupta) and Apu (Subir Banerjee), and Harihar's elderly cousin, Indir Thakrun (Chunibala Devi). Because of their limited resources, Sarbajaya resents having to share her home with the old and helpless cripple Indir. At times, Sarbajaya's taunts become offensive, forcing Indir to take temporary refuge in the home of another relative. Durga is fond of Indir and often gives her fruit she has stolen from a wealthy neighbour's orchard. One day, the neighbour's wife accuses Durga of stealing a bead necklace (which Durga denies) and blames Sarbajaya for encouraging her tendency to steal.
As the elder sibling, Durga cares for Apu with motherly affection, but spares no opportunity to tease him. Together, they share the simple joys of life: sitting quietly under a tree, viewing pictures in a travelling vendor's bioscope, running after the candy man who passes through the village, and watching a jatra (folk theatre) performed by a troupe of actors. Every evening they are delighted by the sound of a distant train's whistle. One day, they run away from home to catch a glimpse of the train, only to discover Indir lying dead on their return.
Unable to earn a good living in the village, Harihar travels to the city to seek a better job. He promises Sarbajaya that he will return with money to repair their dilapidated house. During his absence, the family sinks deeper into poverty. Sarbajaya grows increasingly lonely and bitter. One day during the monsoon season, Durga plays in the downpour for too long, catches a cold and develops a high fever. Adequate medical care being unavailable, the fever becomes worse, and on a night of incessant rain and gusty winds, she dies. Harihar returns home and starts to show Sarbajaya the merchandise he has brought from the city. Sarbajaya, who remains silent, breaks down at the feet of her husband, and Harihar cries out in grief as he discovers that he has lost his daughter. The family decide to leave their ancestral home. As they start packing, Apu finds the necklace that Durga had earlier denied having stolen; he throws it into a pond. Apu and his parents leave the village on an ox-cart.