Esther Greenwood, a young woman from the suburbs of Boston, gains a summer internship at a prominent magazine in New York City under editor Jay Cee. However, Esther is neither stimulated nor excited by either the big city or the glamorous culture and lifestyle that girls her age are expected to idolize and emulate. Instead, her experiences frighten and disorient her. She appreciates the witty sarcasm and adventurousness of her friend Doreen, but also identifies with the piety of Betsy (dubbed "Pollyanna Cowgirl"), a "goody-goody" sorority girl who always does the right thing. She has a benefactress in Philomena Guinea, a formerly successful fiction writer (based on Olive Higgins Prouty), who will later pay some of Esther's hospital expenses.
Esther describes in detail several seriocomic incidents that occur during her internship, kicked off by an unfortunate but amusing experience at a banquet for the girls given by the staff of Ladies' Day magazine. She reminisces about her friend Buddy, whom she has dated more or less seriously and who considers himself her de facto fiancé. She also muses about Julius and Ethel Rosenberg, who are scheduled for execution. She returns to her Massachusetts home in low spirits. She has been hoping for another scholarly opportunity once she is back in Massachusetts, a writing course taught by a world-famous author, but on her return her mother immediately tells her she was not accepted for the course. She decides to spend the summer potentially writing a novel, although she feels she lacks enough life experience to write convincingly. All of her identity has been centered upon doing well academically; she is unsure of what to make of her life once she leaves school, and none of the choices presented to her (motherhood, as exemplified by the vacuous, prolific child-bearer Dodo Conway, or stereotypical female careers such as stenography) appeal to her.
Esther becomes increasingly depressed and finds herself unable to sleep. Her mother encourages, or perhaps forces, her to see a psychiatrist, Dr. Gordon, whom Esther mistrusts because he is attractive and seems to be showing off a picture of his charming family rather than listening to her. He prescribes electroconvulsive therapy (ECT). Afterward, she tells her mother that she will not go back:
My mother smiled. "I know my baby wasn't like that." I looked at her. "Like what?" "Like those awful people. Those awful dead people at that hospital." She paused. "I knew you'd decide to be all right again."
Esther's mental state worsens. She describes her depression as a feeling of being trapped under a bell jar, struggling for breath. She makes several half-hearted attempts at suicide, including swimming far out to sea, before making a serious attempt. She leaves a note saying she is taking a long walk, then crawls into the cellars and swallows about 50 sleeping pills that have been prescribed for her insomnia. In a very dramatic episode, the newspapers presume her kidnapping and death, but she is discovered under her house after an indeterminate amount of time. She survives and is sent to a different mental hospital, where she meets Dr. Nolan, a female therapist. Along with regular psychotherapy sessions, Esther is given huge amounts of insulin to produce a "reaction," and again receives shock treatments, with Dr. Nolan ensuring that they are properly administered. Esther describes the ECT as beneficial in that it has a sort of antidepressant effect, lifting the metaphorical bell jar in which she has felt trapped and stifled. Her stay at the private institution is funded by her benefactress, Philomena Guinea.
Esther tells Dr. Nolan how she envies the freedom that men have and how she, as a woman, worries about getting pregnant. Dr. Nolan refers her to a doctor who fits her for a diaphragm. Esther now feels free from her fears about the consequences of sex; free from previous pressures to get married, potentially to the wrong man. Under Dr. Nolan, Esther improves and various life-changing events help her regain her sanity. The novel ends with her entering the room for her interview which will decide whether she can leave the hospital.
It is suggested near the beginning of the novel that, in later years, Esther goes on to have a baby.