The play is set in the court of Malfi (Amalfi), Italy, from 1504 to 1510. The recently widowed Duchess falls in love with Antonio, a lowly steward. Her brothers, Ferdinand and the Cardinal, forbid her from remarrying, seeking to defend their inheritance and desperate to avoid a degrading association with a social inferior. Suspicious of her, they hire Bosola to spy on her. She elopes with Antonio and bears him three children secretly. Bosola eventually discovers that the Duchess is pregnant but does not know who the father is.
Ferdinand, shown by now to be a depraved lunatic, threatens and disowns the Duchess. In an attempt to escape, she and Antonio concoct a story that Antonio has swindled her out of her fortune and must flee into exile. The Duchess takes Bosola into her confidence, unaware that he is Ferdinand's spy, and arranges for him to deliver her jewellery to Antonio at his hiding-place in Ancona. She will join them later, while pretending to make a pilgrimage to a nearby town. The Cardinal hears of the plan, instructs Bosola to banish the two lovers, and sends soldiers to capture them. Antonio escapes with their eldest son, but the Duchess, her maid, and her two younger children are returned to Malfi and die at the hands of Bosola's executioners, who are under Ferdinand's orders. This experience leads Bosola to turn against the brothers, and he decides to take up the cause of “revenge for the Duchess of Malfi” (5.2).
The Cardinal confesses his part in the killing of the Duchess to his mistress, Julia, then murders her with a poisoned Bible. Bosola overhears the Cardinal plotting to kill him, so he visits the darkened chapel to kill the Cardinal at his prayers. Instead, he mistakenly kills Antonio, who has just returned to Malfi to attempt a reconciliation with the Cardinal. Bosola then stabs the Cardinal, who dies. In the brawl that follows, Ferdinand and Bosola stab each other to death.
Antonio's elder son by the Duchess appears in the final scene and takes his place as the heir to the Malfi fortune. The son's decision is in spite of his father's explicit wish that he "fly the court of princes", a corrupt and increasingly deadly environment.
The conclusion is controversial for some readers because they find reason to believe the inheriting son is not the rightful heir of the Duchess. The play briefly mentions a son who is the product of her first marriage and would therefore have a stronger claim to the duchy. Other scholars believe the mention of a prior son is just a careless error in the text.