Sheila, a recently divorced bank teller, finds herself constantly reprimanded for minor mistakes by her superiors while also feeling overshadowed by her teenage son Vince's girlfriend, Gwen. After discovering her ex-husband's new relationship and witnessing an intimate moment between Vince and Gwen, she decides to visit the department store, Dentley & Soper's, in search of a dress for an upcoming date. With the help of the enigmatic store clerk Miss Luckmoore, Sheila is captivated by an exquisite, flowing red dress that Luckmoore encourages her to buy.
However, soon after wearing the dress, Sheila develops an unusual rash on her chest, and while attempting to wash it, her washing machine breaks down, resulting in an injury to her hand. Strangely enough, the mannequins in the store come to life during the night, and the elderly proprietor Mr. Lundy watches disturbing scenes unfold, including a lifelike mannequin that appears to have a life of its own.
When Sheila returns to the store, she learns that the dress is one of a kind, as the model who wore it for the catalog met a tragic end. As Sheila ventures on a date with her new suitor Zach, Vince and Gwen are engaged in their own passionate encounter when the dress unexpectedly attempts to suffocate Gwen at the peak of her climactic moment.
Later, during an outing with Zach, Sheila is viciously attacked by a German Shepherd, injuring her leg and ripping the dress. Unbelievably, when Vince returns home, he brings the dress with him, still in pristine condition. That night, Sheila grows increasingly uneasy as strange noises emanate from the wardrobe, prompting her to attempt to return the cursed dress to the store, but her efforts are in vain. After sharing a troubling dream about seeing her mother in a mirror with her bosses, Sheila tragically dies in an accident while on her way to spend time with Zach, her dress still in her car's boot.
Following this, the dress finds its way into the hands of washing machine repairman Reg Speaks, who, under the pressure of his friends, reluctantly dons the dress during his stag night. Reg, whose social interactions are often awkward, has a peculiar talent for putting people in a trance with his detailed explanations of washing machines, which complicates his intimate life with his fiancée, Babs. His dreams take a dark turn when he envisions himself excluded from a delivery room where Babs gives birth to a child dressed similarly to the cursed garment.
Babs, enchanted by the dress, wears it while shopping at Dentley & Soper's. Miss Luckmoore reprimands her for being there so late but is swayed by Mr. Lundy to allow her to stay. Meanwhile, Reg becomes entranced by the store's TV advertisement and dies inconceivably due to carbon monoxide poisoning from his faulty boiler. Babs shares a disturbing vision with Luckmoore in which she transforms into a store model, gradually diminishing until she is metaphorically buried beneath the weight of commercialism.
Chaos ensues in the store, resulting in a brawl that escalates into a full-blown looting. The dress's demise occurs as it falls onto a heater, igniting a rapid fire that engulfs the entire establishment. Babs perishes in the flames within the fitting room, while Luckmoore, seeking refuge in a dumbwaiter with a dismembered mannequin, fantasizes about the horrors around her. As she descends deeper into the store, she glimpses the deceased forms of Sheila, Reg, and Babs stitching the cursed dress together from their own blood, amidst an array of sewing stations meant for future wearers. As the firemen survey the devastation, one makes a haunting discovery—the dress, remarkably unscathed, lies among the ruins, waiting for its next victim.
