Dr. Martin Dysart is a psychiatrist who specializes in the treatment of children, but he has grown dissatisfied with his work. He is tired of his dull life and wonders if he is doing right by the children he treats. One day Hesther Salomon, a court magistrate, comes into his office, imploring him to take on a new client. This client is a seventeen-year-old boy named Alan Strang, who recently blinded six horses with a spike. She believes that only Dysart's treatment can keep the boy out of prison. Reluctantly, Dysart agrees to treat him.
Alan is very uncooperative at first, singing commercial jingles rather than answering Dysart's questions. He has nightmares often, screaming in his sleep. Dysart begins to uncover things about Alan's family life; his father, Frank Strang, banned T.V. from their house, and his mother, Dora Strang, is devoutly religious and read Alan Bible passages very frequently while he grew up. Each parent believes that the other's actions while raising their son had something to do with the crime he ultimately committed.
At last, Dysart is able to coax Alan into answering his questions. Alan has always been deeply fascinated by horses, and his first memory of a horse was on a beach when he was six years old. A horseman came riding by and invited Alan up to sit on the horse's neck; when his parents came by and saw him there, they chastised the horseman for putting their son in such a dangerous situation, and Frank pulled Alan from the horse so forcefully that he fell off. Later on, Alan, relayed on a tape recording, describes to Dysart the feeling of being on this horse; he describes the feel of the horse's skin beneath his with an almost sexual admiration.
Dora and Frank each visit Dysart's office separately to report strange behavior from Alan. Dora talks about a horse photograph that Frank had given Alan; it replaced a reproduction of a famous religious painting of Jesus in chains, and Alan kept it in the exact same place and revered it in the same way. Frank recounts a time when he saw Alan chanting religiously in front of the photograph, yelling the name "Equus." Dalton, the owner of the stable where Alan worked and where he blinded the horses, comes in as well and tells Dysart to ask Alan about a girl named Jill Mason.
Dysart coaxes Alan for information on Jill; she is a girl who worked in the stables with him, and who introduced him to the job in the first place. Dysart begins to pry, asking whether or not Alan liked the girl, which makes him angry; Alan starts to pry in return and asks about Dysart's wife, with whom Dysart does not have a good relationship. Later on, Dysart has a conversation with Hesther about whether or not he is right to try and restore Alan to a 'normal' life.
Dysart uses hypnosis on Alan to get him to describe what he used to do with the horses at night in the stables. It is confirmed at last that Alan reveres horses as a manifestation of the god Equus, a spirit who lives in all horses. One particular horse in the stable, Nugget, had come to represent Equus more than any of the others, and Alan would take him out at night to a field, undress, and ride him bareback, achieving orgasm.
Things are getting difficult as the treatment progresses. Dora visits again, upsetting Alan by yelling at him, and on her way out she tells Dysart that it is not fair that parents are always blamed for children's mental issues. She insists that this all came from Alan, and Alan alone. Alan asks Dysart if he would be giving him a truth pill that would make him tell all; such a thing does not exist, but Dysart muses over using a placebo so that Alan thinks he has taken a truth pill. In another conversation with Hesther, Alan laments the thought of taking away Alan's worship; Hesther says that Alan is in pain, and that Dysart is able to take it away; but Dysart insists that this pain comes from intense passion, and so it is not all that bad.
Dysart uses the placebo on Alan, and he begins to reveal the truth about what happened the night of the crime. Jill asked him to take her on a date to a pornographic movie theater. They go, and Frank turns out to be at the movie, too, resulting in an awkward encounter between Alan and his father. Alan begins to walk Jill home, but she takes his hand and tells them she knows a place where they can go to be alone. To Alan's dismay, she takes him to the stables—he knows he cannot have sex and betray his intimacy with his god there, with all the horses watching. Even when they shut the door between the barn and the stables, he cannot go through with it; he only feels and sees Equus whenever he touches Jill.
After Jill leaves, disappointed and frightened, Alan begs Equus for forgiveness. In Alan's mind, Equus stakes claim to Alan; he says that he can see Alan's every move, everywhere, and will always be watching him. Outraged, Alan takes a spike from the barn and blinds six of the horses. After Alan finishes telling the story, he begins to convulse on the ground in Dysart's office until Dysart soothes him to sleep. Dysart says he will attempt to take the pain away from Alan and send him into a normal life, though this 'normal' is not ideal. He laments the permanence of what he does to children as a psychiatrist, and realizes that he himself is bound and chained by his career the way horses are bound and chained in service to their riders.