The protagonist in the story is Nell, a thete (or person without a tribe; equivalent to the lowest working class) living in the Leased Territories, a lowland slum built on the artificial, diamondoid island of New Chusan, located offshore from the mouth of the Yangtze River, northwest of Shanghai. When she is four, Nell's older brother Harv gives her a stolen copy of a highly sophisticated interactive book, Young Lady's Illustrated Primer: a Propædeutic Enchiridion, in which is told the tale of Princess Nell and her various friends, kin, associates, etc., commissioned by the wealthy Neo-Victorian "Equity Lord" Alexander Chung-Sik Finkle-McGraw for his granddaughter, Elizabeth. The story follows Nell's development under the tutelage of the Primer, and to a lesser degree, the lives of Elizabeth Finkle-McGraw and Fiona Hackworth, Neo-Victorian girls who receive other copies. The Primer is intended to steer its reader intellectually toward a more interesting life, as defined by Lord Finkle-McGraw, and growing up to be an effective member of society. The most important quality to achieving an interesting life is deemed to be a subversive attitude towards the status quo. The Primer is designed to react to its owner's environment and teach them what they need to know to survive and develop.
The Diamond Age features intersecting story lines: the social downfall of the nanotech engineer designer of the Primer, John Percival Hackworth, who makes an unauthorized copy of the Primer for his own young daughter, Fiona, and Nell's education through her independent work with the Primer after her brother Harv steals it from Hackworth. Hackworth's crime becomes known to Dr. X, the black market engineer whose compiler Hackworth used to create the copy of the Primer, and later Lord Finkle-McGraw. Hackworth is compelled by both to advance their opposing goals. Another storyline follows actress ("ractor") Miranda Redpath, who voices most of the Primer characters who interact with Nell and effectively becomes a surrogate mother to Nell. After Miranda disappears in her quest to find Nell, her storyline continues from the point of view of her her boss, Carl Hollywood.
The Diamond Age also includes fully narrated educational tales from the Primer that map Nell's individual experience (e.g. her four toy friends) onto archetypal folk tales stored in the primer's database. The story explores the role of technology and personal relationships in child development, and its deeper themes also probe the relative values of cultures.
