In London, 1889, Dr James Mortimer asks for the aid of Sherlock Holmes, recounting the legend of a curse that has run in the Baskerville family since the time of the English Civil War, when Sir Hugo Baskerville kidnapped a farmer's daughter. When the girl escaped, Hugo made a deal with the devil and pursued her. Hugo's companions found the girl dead of fear and Hugo killed by a demonic hound, which is said to have haunted Dartmoor ever since, causing the premature death of many Baskerville heirs. Mortimer says that his friend Sir Charles Baskerville, who took the legend seriously, was found dead in the yew alley of his estate, Baskerville Hall, on Dartmoor. A locally noted philanthropist, Sir Charles had retired to his family estate in 1887 after some years in South Africa, where he had made a fortune through shrewd investments. His death was attributed to a heart attack, but his face had an expression of horror, and not far from his body were the footprints of a gigantic hound.
As the executor of Sir Charles's will, Mortimer fears for the new Baskerville baronet, Sir Henry Baskerville, the nephew of Sir Charles. Sir Charles had been the eldest of three Baskerville brothers; after Sir Henry, there were no further immediate heirs to the title and estate. Sir Charles's youngest brother, Rodger, who had led a scandalous life in England, had fled to Central America, where he had died of yellow fever in 1876, unmarried and childless. Though Holmes dismisses the curse as a fairy-tale, he agrees to meet Sir Henry who arrives from Canada, sceptical of the legend and eager to take possession of Baskerville Hall in spite of receiving an anonymous note warning him to stay away from the moor; Holmes also witnesses someone following Sir Henry. Mortimer reveals that Sir Henry had inherited a vast fortune from his late uncle – £740,000 (equivalent to £87,000,000 in 2021[6]). Realising this provides a strong motive for anyone trying to do Sir Henry harm, Holmes asks Watson to go with Sir Henry and Mortimer, in order to protect the baronet and investigate who is following him.
Arriving in Dartmoor, Watson, Mortimer and Sir Henry learn that convicted murderer Selden has escaped from Dartmoor Prison and is hiding on the moor. They arrive at Baskerville Hall where a married couple, the Barrymores, are butler and housekeeper. Watson sends details of his investigations to Holmes, particularly on the neighbourhood residents. The Stapletons, brother and sister, stand out: Jack is overfriendly, particularly as he warns Watson about the Grimpen Mire, where horses can sink to their death, and curious about the newcomers, while Beryl is weary of the moor and attempts to warn Sir Henry of danger. Distant hound-like howls start troubling Watson and he witnesses Barrymore, who signals at night with a candle to someone on the moor. Sir Henry is drawn to Beryl despite her brother's initial attitude to any relationship and Frankland, an old and grumpy neighbour, likes to spy on others with his telescope and notes ancient tombs have been excavated by Mortimer. Watson and Sir Henry investigate the Barrymores and learn that Selden is Mrs Barrymore's brother, and that they have been taking food to him. During an unsuccessful attempt to catch Selden, Watson sees an unknown man standing on a tor. They learn from Barrymore that Frankland's estranged daughter Laura has unclear ties to Sir Charles.
Watson investigates the man on the tor and discovers that it is Holmes, who explains that he came secretly to the moor to hide his direct involvement. Holmes explains that he is close to solving the mystery. He explains that Stapleton is the suspect and that Beryl is actually Stapleton's wife, abused and forced into posing as his sister so as to influence Sir Henry and expose him to the hound. The hound kills a man on the moor whom Holmes and Watson fear is Sir Henry, but turns out to be Selden; Barrymore had given him Sir Henry's discarded clothes. Holmes decides to use Baskerville as bait to catch Stapleton. While dining with Sir Henry and Watson, Holmes suddenly notices a portrait of Sir Hugo Baskerville and recognises a family resemblance to Stapleton. He tells Sir Henry to accept an invitation to Stapleton's house and walk back after dark, giving his enemy every chance to unleash the hound.
Holmes and Watson pretend to leave Dartmoor by train but instead hide near Stapleton's house with Inspector Lestrade of Scotland Yard. Despite thick fog, Holmes and Watson manage to kill the hound when it attacks Sir Henry. They find Beryl tied up in Stapleton's house, while Stapleton himself, in his flight from the scene, seemingly drowns in the mire. In London, following a visit from Sir Henry and Dr. Mortimer, who leave on a trip to help improve Sir Henry's nerves, Holmes explains to Watson that Stapleton was Sir Henry's cousin, Rodger Baskerville, the only son of his namesake father, and that he had been hoping to inherit the family estate. A physical and spiritual throwback to Sir Hugo Baskerville, he had intended to kill his relations with a vicious hound painted with phosphorus to appear sinister. He had promised Laura marriage and convinced her to lure Sir Charles out of his house at night, in order to frighten him to death with the animal; Holmes remarks to Watson that Stapleton was one of the most formidable foes they had ever encountered.
