Rhoda Penmark, an eight-year-old girl, is renowned among adults for her charming demeanor and sharp intelligence, but her classmates at Fern Grammar School keep their distance from her, sensing that "something isn’t quite right" about her nature. Her mother, Christine, notices her daughter’s callousness when she displays an unsettling indifference toward the sudden death of a classmate, Claude Daigle, whom everyone believes died accidentally. However, what alarms Christine is the presence of unexplainable crescent-shaped marks on Claude’s face, which seem to hint at something more sinister. She soon uncovers that Rhoda had a quarrel with Claude over a medal for perfect penmanship that he had recently won, a medal Rhoda believed she deserved herself, revealing her competitive and ruthless nature even at such a young age.
As Christine observes Rhoda's disturbing attitude, she begins to reflect on past anomalies within their household—such as the mysterious deaths of her pet dog and her elderly babysitter—incidents that now seem increasingly suspicious. Her unease grows as she starts to suspect her daughter might be responsible for these tragedies. To her shock, she learns a dark family secret: she was adopted, and her birth mother, Bessie Denker, was a notorious serial killer who met her death in the electric chair. This revelation causes Christine’s mental health to decline as she grapples with the realization that Rhoda may have inherited her mother’s dangerous, “bad seed” gene.
Christine keeps a journal of her fears, writing letters to her husband, Kenneth, in which she confesses her fears about Rhoda, blaming herself for passing on such a dangerous trait. She never sends the letters, consumed by fear that someone might discover her confessions and take action. The only other person aware of Rhoda's true nature is Leroy Jessup, the maintenance man and neighbor, who persistently taunts Rhoda about Claude’s death. Rhoda initially feigns indifference but grows frantic when Leroy hints that she used her cleated shoes to beat Claude, leaving the crescent-shaped marks on his face. Fearing exposure, Rhoda takes drastic action—she sets Leroy's mattress on fire and locks him in his shed while he sleeps, a decision Christine witnesses in horror from a distance.
The climax unfolds as Christine finally confronts Rhoda, who, without showing any remorse, admits to committing the murders. In a desperate attempt to prevent her daughter from following her grandmother’s murderous path, Christine secretly gives Rhoda an overdose of sleeping pills, destroys her threatening letters, and then takes her own life with a gunshot. The neighbors hear the gunfire and break into the apartment, rescuing Rhoda, but Christine succumbs to her injuries in the hospital. Kenneth returns home, devastated by the loss of his wife, while Rhoda remains unscathed and free from suspicion. With all evidence of her dark deeds erased and her mother gone, Rhoda is left to continue her life, potentially capable of harming again without anyone knowing the truth behind her chilling innocence.