American Born Chinese contains three apparently separate storylines that eventually intersect.
The book begins with the story of the Monkey King ("Sun Wukong" in Chinese), who is one of the main characters in the 16th-century Chinese novel Journey to the West. After a guard denies the monkey deity access to a party in the heavens because he is a monkey and doesn't wear shoes, the Monkey King beats up the gods, goddesses, demons, and spirits present. The heavens level an execution order against him, but he learns new Kung-Fu disciplines to make himself invulnerable to attack and capable of shifting his shape.
Eventually, Tze-Yo-Tzuh, the creator of everything, approaches the monkey king after hearing much about his rampage. After his unsuccessful attempt to convince the monkey to stop, he buries the Monkey King under a pile of rocks for five hundred years, banning him from practicing his heavenly style of Kung-Fu. In time, Tze-Yo-Tzuh gives the monkey as a disciple to a monk named Wong Lai-Tsao. After Lai-Tso informs the monkey that he merely needs to accept his true form in order to be free of the rocks, they go on a journey to the west.
Jin Wang's storyline establishes how he grew up in the U.S. as the first-generation child of Chinese immigrants. After living his early life in San Francisco's Chinatown, Jin moves to a suburb and attends a school where he is one of three Asian students. In an atmosphere of casual racism, Jin struggles to fit in with the white majority. He becomes best friends with Wei-Chen, a recent immigrant from Taiwan, and Wei-Chen's Japanese-American girlfriend Suzy Nakamura. Jin becomes infatuated with a white student named Amelia Harris. They go on a date to the movies, but their romance is cut short when Amelia's friend Greg asks Jin not to ask her out again, as Greg believes they aren't suited for each other. That same day, Jin has a falling out with Wei-Chen after Jin suddenly kissed Suzy outside the school.
The third storyline follows a white teenager named Danny, whose Chinese cousin Chin-Kee visits every year and ruins the reputation he has established at his high school. Danny's frustration with Chin-Kee grows to the point where he attacks him, and it is revealed that Chin-Kee is in fact the Monkey King, while Danny is the fantasy alter-ego Jin created after the shame of believing his Chinese identity is what prevented him from being accepted by Greg and Amelia. The Monkey King explains that Wei-Chen is his son, who was tasked with living on Earth in mortal form for forty years and avoiding human vice. Since their falling out, Wei-Chen devoted himself to a life of human pleasures.
The book concludes with Jin having returned to his true form and the Monkey King ascending to the heavens. A business card for a Chinese restaurant falls from the sky. Jin goes every day for a week until Wei-Chen pulls up out front. The book ends with the two friends making up after years of not talking to each other.