Dorothy Gale is a young girl who lives with her Aunt Em and Uncle Henry and her little dog Toto on a Kansas farm. One day, Dorothy and Toto are caught up in a cyclone that deposits her farmhouse into Munchkin Country in the magical Land of Oz. The falling house has killed the Wicked Witch of the East, the evil ruler of the Munchkins. The Good Witch of the North arrives with the grateful Munchkins and gives Dorothy the Silver Shoes that once belonged to the witch. The Good Witch of the North tells Dorothy that the only way she can return home is to go to the Emerald City and ask the great and powerful Wizard of Oz to help her. As Dorothy embarks on her journey, the Good Witch of the North kisses her on the forehead, giving her magical protection from fatal harm.
On her way down the yellow brick road, Dorothy frees the Scarecrow from the pole on which he is hanging, applies oil from a can to the rusted connections of the Tin Woodman, then meets the Cowardly Lion, and encourages the three of them to journey with her and Toto to the Emerald City. The Scarecrow wants a brain, the Tin Woodman wants a heart, and the Cowardly Lion wants courage. All four believe that the Wizard can solve their troubles. When the travelers finally arrive at the gates of the Emerald City, they are asked by the Guardian of the Gates to wear green tinted spectacles to keep their eyes from being blinded by the city's brilliance. As each one is called to see the Wizard, Dorothy sees the Wizard as a giant head on a marble throne, the Scarecrow as a lovely lady in silk gauze, the Tin Woodman as a terrible beast, and the Cowardly Lion as a ball of fire. The Wizard agrees to help them all if they defeat the Wicked Witch of the West, who rules over Oz's Winkie Country. The Guardian warns them that no one has ever managed to defeat the witch.
The Wicked Witch of the West sees the travelers approaching with her one telescopic eye. She sends a pack of wolves to tear them to pieces, but the Tin Woodman kills them with his axe. She sends wild crows to peck their eyes out, but the Scarecrow kills them by breaking their necks. She summons a swarm of black bees to sting them, but they are killed trying to sting the Tin Woodman while the Scarecrow's straw hides the other three. She sends her Winkie soldiers to attack them, but the Cowardly Lion stands firm to repel them. Finally, she uses the power of the Golden Cap to send the winged monkeys to capture Dorothy, Toto, and the Cowardly Lion, unstuff the Scarecrow, and dent the Tin Woodman. Dorothy is forced to become the witch's personal slave, who schemes to steal Dorothy's Silver Shoes.
The Wicked Witch successfully tricks Dorothy out of one of her Silver Shoes. Dorothy throws a bucket of water at her, and is shocked to see the witch melt away. The Winkies rejoice at being freed of the witch's tyranny and help restuff the Scarecrow and mend the Tin Woodman. They ask the Tin Woodman to become their ruler, which he agrees to do after helping Dorothy return to Kansas. Dorothy finds the Golden Cap and summons the Winged Monkeys to carry her and her companions back to the Emerald City. The King of the Winged Monkeys tells how he and the other monkeys are bound by an enchantment to the cap by the sorceress Gayelette, and that Dorothy may use the cap to summon the Winged Monkeys two more times.
When Dorothy and her friends meet the Wizard of Oz again, Toto tips over a screen in a corner of the throne room that reveals the Wizard. He sadly explains he is a humbug—an ordinary old man who, by a hot air balloon, came to Oz long ago from Omaha. The Wizard provides the Scarecrow with a head full of bran, pins, and needles ("a lot of bran-new brains"), the Tin Woodman with a silk heart stuffed with sawdust, and the Cowardly Lion a potion of "courage". Their faith in the Wizard's power gives these otherwise useless items a focus for their desires. The Wizard decides to take Dorothy and Toto home and leave the Emerald City. At the send off, he appoints the Scarecrow, by virtue of his brains, to rule in his stead, which he agrees to do after Dorothy returns to Kansas. Toto chases a kitten in the crowd and Dorothy goes after him, but the tethers of the balloon break and the Wizard floats away.
Dorothy summons the Winged Monkeys to carry her and Toto home, but they explain they cannot cross the desert surrounding Oz. The Soldier with the Green Whiskers informs Dorothy that Glinda the Good Witch of the South may be able to help her return home. The friends journey to see Glinda, who lives in Oz's Quadling Country, and on the way the Cowardly Lion kills a giant spider who is terrorizing the animals in a forest. The animals ask the Cowardly Lion to become their king, which he agrees to do after helping Dorothy return to Kansas. Dorothy summons the Winged Monkeys a third time to fly them over a mountain to Glinda's palace. Glinda greets the travelers warmly and reveals that the Silver Shoes Dorothy wears can take her anywhere she wishes to go. Dorothy embraces her friends, all of whom will be returned to their new kingdoms through Glinda's use of the Golden Cap: the Scarecrow to the Emerald City, the Tin Woodman to the Winkie Country, and the Lion to the forest. Dorothy knocks her heels together three times and wishes to return home. When she opens her eyes, Dorothy and Toto have returned to Kansas.