The prologue establishes an audience and a speaker, who defines himself by location, education, and occupation. The narrator journeys to Thessaly on business. On the way, he runs into Aristomenes and an unnamed traveler. The unnamed traveler refuses to believe Aristomenes’ story. The narrator scolds the unnamed traveler and tells a short story about a sword swallower. He promises Aristomenes a free lunch if he will retell his tale. The narrator believes Aristomenes’ tale and becomes more eager to learn about magic. The narrator arrives at Hypata, where he stays with Milo, a family friend and miser, and his wife Pamphile. Photis, Milo’s servant, takes the narrator to the baths, after which the narrator goes to the marketplace. There, he buys some fish and runs into his old friend Pytheas, who is now a magistrate. Pytheas reveals the narrator’s name as Lucius. Pytheas says that Lucius overpaid for the fish and humiliates the fish-monger by trampling on the fish. Lucius returns to Milo’s house, hungry and empty-handed. Milo asks Lucius about his life, his friends, and his wanderings. Lucius goes to sleep hungry.
The next morning, Lucius meets his aunt Byrrhena in the town, and she warns him that Milo's wife is an evil witch who will kill Lucius. Lucius, however, is interested in becoming a witch himself. He then returns to Milo's house, where he repeatedly makes love to the slave-girl Fotis (also spelled Photis). The next day, Lucius goes to his aunt's home for dinner, and there meets Thelyphron, who relates his tale of how witches cut off his nose and ears. After the meal, Lucius drunkenly returns to Milo's house in the dark, where he encounters three robbers, whom he soon slays before retiring to bed.
The next morning, Lucius is abruptly awoken and arrested for the murder of the three men. He is taken to court where he is laughed at constantly and witnesses are brought against him. They are just about to announce his guilt when the widow demands to bring out the dead bodies; but when the three bodies of the murdered men are revealed, they have miraculously transformed into puffed-up wineskins. It then turns out that it was a prank played by the town upon Lucius. Later that day, Lucius and Photis watch Milo's wife perform her witchcraft and transform herself into a bird. Attempting to copy her, Lucius accidentally turns himself into an ass, at which point Photis tells him that the only way for him to return to his human state is to eat a rose.
Lucius the ass trots over to a garden to munch on a rose when he is beaten by the gardener and chased by dogs. He is then stolen from Milo's house by thieves, who talk about how their leader Thrasileon has been killed while dressed as a bear. The thieves then kidnap a young woman, Charite, who is housed in a cave with Lucius the ass. Charite starts crying, so an elderly woman who is in league with the thieves begins to tell her the story of Cupid and Psyche.
Psyche is the most beautiful woman on earth, and Venus jealously arranges for Psyche's destruction.
The elderly woman continues telling the story of Cupid and Psyche. Cupid, Venus's son, secretly preserves Psyche; Cupid becomes Psyche's anonymous lover. Psyche's jealous sisters arouse her curiosity and fear; Psyche, against Cupid's commands, looks at him; Cupid abandons Psyche, who wanders in search of him.
The elderly woman finishes telling the story of Cupid and Psyche. Lucius the ass and Charite escape from the cave but they are caught by the thieves, and sentenced to death.
A man appears to the thieves and announces that he is the renowned thief Haemus the Thracian, who suggests that they should not kill the captives but sell them. Haemus later reveals himself secretly to Charite as her fiancé Tlepolemus, and gets all of the thieves drunk. When they are asleep he slays them all. Tlepolemus, Charite and Lucius the ass safely escape back to the town. Once there, the ass is entrusted to a horrid boy who torments him but the boy is later killed by a she-bear. Enraged, the boy's mother plans to kill the ass.
A man arrives at the mother's house and announces that Tlepolemus and Charite are dead, caused by the scheming of the evil Thrasillus who wants Charite to marry him. After hearing the news of their master's death, the slaves run away, taking the ass Lucius with them. The large group of travelling slaves is mistaken for a band of robbers and attacked by farmhands of a rich estate. Several other misfortunes befall the travelers until they reach a village. Lucius as the narrator often digresses from the plot in order to recount several scandal-filled stories that he learns of during his journey. Lucius is eventually sold to a catamite priest. He is entrusted with carrying the statue of a goddess on his back while he follows around the group of sinful priests. While engaging in lewd activity with a local boy, the group of priests is discovered by a man in search of a stolen ass who mistakes Lucius' braying for that of his own animal. The priests flee to a new city where they are well received by one of its chief citizens. They are preparing to dine when his cook realizes that the meat that was to be served was stolen by a dog. The cook, at the suggestion of his wife, prepares to kill Lucius in order to serve his meat instead.
Lucius' untimely escape from the cook coincides with an attack by rabid dogs, and his wild behavior is attributed to their viral bites. The men barricade him in a room until it is decided that he is no longer infected. The band of priests packs up and moves out. The narrative is interrupted by The Tale of the Wife's Tub. After the arrest of the priests Lucius is sold into labor, driving a baker's mill-wheel. Lucius, though bemoaning his labor as an ass, also realizes that this state has allowed him to hear many novel things with his long ass-ears. The Tale of the Jealous Husband and The Tale of the Fuller's Wife mark a break in the narrative. The theme of the two intervening stories is adultery, and the text appropriately follows with the adultery of the baker's wife and the subsequent murder of the baker. Lucius the ass is then auctioned off to a farmer. The Tale of the Oppressive Landlord is here told. The farmer duly assaults a legionary who makes advances on his ass (Lucius), but he is found out and jailed.
Lucius comes into the legionary's possession, and after lodging with a decurion Lucius recounts Tale of the Murderous Wife. He is then sold to two brothers, a confectioner and a cook, who treated him kindly. When they go out Lucius secretly eats his fill of their food. At first a source of vexation, when the ass was discovered to be the one behind the disappearing food it was much laughed at and celebrated. Again he was sold, and he was taught many amusing tricks. Rumor spread, and great fame came to the ass and his master. As it happened, a woman was so enamored of the sideshow ass that she paid off his keeper and took him to bed with her. The Tale of the Jealous Wife is aired. The murderess depicted in this tale is precisely she whom Lucius is made to mate with at the Shows. After an enactment of the judgment of Paris and a brief but important digression, the time comes for Lucius to make his much awaited appearance. At the last moment he decides against this, fearing for his life, and he runs away to Cenchreae eventually to nap on the beach.
Lucius wakes up in a panic during the first watch of the night. Considering Fate to be done tormenting him, he takes the opportunity to purify himself by seven consecutive immersions in the sea. He then offers a prayer to the Queen of Heaven, for his return to human form, citing all the various names the goddess is known by to people everywhere (Venus, Ceres, Paphos, Proserpine, etc.). The Queen of Heaven appears in a vision to him and explains to him how he can be returned to human form by eating the crown of roses that will be held by one of her priests during a religious procession the following day. In return for his redemption, Lucius is expected to be initiated through the Navigium Isidis into Isis’ priesthood (Isis being the Queen of Heaven’s true name, according to her). Lucius follows her instructions and is returned to human form and, at length, initiated into her priesthood. Lucius is then sent to his ancestral home, Rome, where he continues to worship Isis, under the local name, Campensis. After a time, he is visited once more by the goddess who speaks again of mysteries and holy rites which Lucius comes to understand as a command to be initiated into the cult of Isis. He does so. Shortly afterwards, he receives a third vision. Though he is confused, the god appears to him and reassures him that he is much blessed and that he is to become once more initiated that he might supplicate in Rome as well. The story concludes with the goddess, Isis, appearing to Lucius and declaring that Lucius shall rise to a prominent position in the legal profession and that he shall be appointed to the College of Pastophori that he might serve Osiris and Isis’ mysteries. Lucius is so happy that he goes about freely exposing his bald head.