The story begins with a chilling view from the perspective of a psychotic killer, seemingly a teenage girl with long hair clad in a nightdress, brutally murdering her parents with a hammer during a stormy night. The scene is distorted, hinting at the killer's unstable mental state.
Fast forward four years, and we meet Sarah Cassidy (Elisabeth Shue) and her teenage daughter Elissa Cassidy (Jennifer Lawrence), who have just moved into what they believe is their dream home in a quaint yet upscale town. However, their excitement quickly turns to dread when they discover unsettling events unfolding around them. They learn from the locals that four years prior, a girl named Carrie-Ann Jacobson murdered her parents in the very house next door and vanished into the nearby woods. While most residents assume she drowned in the river, the absence of her body gives rise to the eerie belief that she may still be alive, lurking within the forest.
Living next to them is Ryan Jacobson (Max Thieriot), the only living relative of Carrie-Ann, who had been caring for his sick aunt far away at the time of the murders. Now alone in his dilapidated home, Ryan faces the scorn of the neighborhood, which blames him for driving down property values. A local police officer, Bill Weaver (Gil Bellows), stands as Ryan's only ally.
Despite Sarah's objections, Elissa and Ryan begin to develop a romantic relationship. Ryan opens up about his past, confessing that he inadvertently hurt Carrie-Ann during a childhood swing accident, leaving her aggressive due to brain damage. Flashbacks reveal the sinister reality that, since the murders, Ryan has been secretly caring for a woman resembling Carrie-Ann in a hidden chamber within the house – a secret unknown to the townsfolk. Carrie-Ann manages to escape twice and attempts to attack Elissa, but during the second escape, Ryan inadvertently kills her while trying to hide her from a group of teenagers.
As tensions rise, Ryan finds himself in a confrontation at a battle of the bands event, where he is assaulted by other students, leading him to react and break one of their ankles. The situation escalates as his house is targeted for an arson attack, which Elissa narrowly prevents. She later discovers peculiar items that imply a much darker truth about Ryan's life. Among these, she finds evidence of Ryan's hidden room where Carrie-Ann has been kept.
When Elissa stumbles upon the terrible truth and is attacked by Carrie-Ann, Ryan resorts to knocking her unconscious and binding her to a chair. He reveals his twisted perspective, claiming that Carrie-Ann actually died in the swing incident but that he still needs her in his life. He expresses his desire to mold Elissa into the new Carrie-Ann to fulfill his obsession.
As the shocking narrative unfolds, it becomes evident that the girl they thought was Carrie-Ann was a different victim who had managed to escape Ryan’s grasp at one point. In a confrontation with Officer Weaver, Ryan's violent tendencies manifest when he fatally stabs Weaver, furiously hiding his horrific actions from the world.
As Elissa fights for her life, she ultimately escapes, but not before a disturbing series of events leads to a confrontation with Ryan, who stabs Sarah in a frantic struggle. In an intense climax, Elissa finally takes control, shooting Ryan multiple times with Weaver's gun, forcing him into submission.
The film closes with Elissa and Sarah leaving the house haunted by their experiences while Ryan is shown confined in a mental institution. A haunting flashback reveals the traumatic origins of Ryan's disturbed psyche, illustrating the profound abuse he suffered at the hands of his parents after Carrie-Ann’s tragic demise, showing just how deep the scars of his past truly run.
