The character Japhy drives Ray Smith's story, whose penchant for simplicity and Zen Buddhism influenced Kerouac on the eve of the sudden and unpredicted success of On the Road. The action shifts between the events of Smith and Ryder's "city life," such as three-day parties and enactments of the Buddhist "Yab-Yum" rituals, to the sublime and peaceful imagery where Kerouac seeks a type of transcendence. The novel concludes with a change in narrative style, with Kerouac working alone as a fire lookout on Desolation Peak (adjacent to Hozomeen Mountain), in what would soon be declared North Cascades National Park (see also Kerouac's novel Desolation Angels). His summer on Desolation Peak was desperately lonely. “Many's the time I thought I'd die of boredom or jump off the mountain,” he wrote in ‘’Desolation Angels.’’ Yet in the more eloquent ‘’Dharma Bums,” Kerouac described the experience in elegiac prose.
Down on the lake rosy reflections of celestial vapor appeared, and I said 'God, I love you' and looked up to the sky and really meant it. 'I have fallen in love with you, God. Take care of us all, one way or the other.’
The blend of narrative with prose-poetry places The Dharma Bums at a critical junction foreshadowing the consciousness-probing works of several authors in the 1960s such as Timothy Leary and Ken Kesey.
One episode in the book features Smith, Ryder, and Henry Morley (based on real-life friend John Montgomery) climbing Matterhorn Peak in California. It relates Kerouac's introduction to this type of mountaineering and inspired him to spend the following summer as a fire lookout for the United States Forest Service on Desolation Peak in Washington.
The novel also gives an account of the legendary 1955 Six Gallery reading, where Allen Ginsberg gave a debut presentation of his poem "Howl" (changed to "Wail" in the book). At the event, other authors including Snyder, Kenneth Rexroth, Michael McClure, and Philip Whalen also performed.