Set in the fictional town of Wellington, The Marrow of Tradition features several interweaving plots that encompass the poles of the racially segregated society of the American South at the turn of the century. One plot follows Major Carteret, the white owner of the major Wellington newspaper, as he colludes with several other powerful white men to take political control of the town. They are outraged about a provocative editorial published in a black paper that questioned white justifications for lynchings. As the town’s unrest intensifies, Carteret faces domestic pressures; his only child Dodie and wife Olivia are both unwell. Carteret’s niece Clara, recently introduced to society, is courted by the young Tom Delamere, a handsome and conniving aristocrat who spends most evenings nurturing his penchant for drink and cards. His habits are contrasted with those of Lee Ellis, a rival for Clara, and William Miller, a young black physician who with his wife has returned to his hometown of Wellington to practice medicine. He gained his medical education in Paris and Vienna. Though jarred by segregation and Jim Crow racism, Miller sets up his practice and starts his life. Miller's wife, Janet, is the mulatto half-sister of Mrs. Olivia Carteret; Janet spends her entire life hoping to be acknowledged by her white sister, who is too proud to accept her father's miscegenation after her mother died. Josh Green as a boy witnessed the murder of his father at the hands of a white man—a character named Captain McBane—and is intent on exacting revenge.
All these subplots are forced to a crisis through two events: the murder of a white woman, Polly Ochiltree, for which a black servant, Sandy Campbell, is accused, and county elections. Campbell would have been lynched and burned without a trial if it weren't for Miller alerting his boss, the grandfather of the actual murderer, Tom Delamere. Old Mr. Delamere and Lee Ellis discover the truth and save Sandy's life, but Tom is never apprehended for his crime. A few months later, on the eve of the elections Major Carteret, Captain McBain, and one General Belmont conspired to incite a "revolution," overthrowing the Republican party from power and keeping blacks from participating in the elections. They published inflammatory statements in the Morning Chronicle and the revolution quickly became a riot which engulfed the town.
The novel culminates with justice for some—the faithful servant Campbell is saved by his patron, Delamere falls from grace, Josh Green avenges his father's death albeit at the cost of his own life, and Janet Miller gains recognition from her sister, who, along with Major Carteret, was humbled to respect the black Miller family in order to save an ailing Dodie.