On a secluded farm, Pete Morgan, Edward G. Robinson is a handicapped farmer who shares the land with his sister Ellen Morgan, Judith Anderson, and their adopted daughter Meg Morgan, Allene Roberts. They keep to themselves, and the nearby town views them as mysterious figures drifting on the edge of ordinary life. Now a teenager, Meg persuades Pete to hire Nath Storm, Lon McCallister, a 12th-grade classmate, to come help with chores on the farm. On the first evening, Nath mentions a shortcut through the old woods—part of Pete’s property that he forbids anyone to enter. Pete becomes agitated, insisting the woods are dangerous and house a haunted red-painted structure, and he orders Nath to stay out.
After wandering the woods in the dark, Nath returns spooked by moans and yells. A few days later, embarrassed by his earlier fear, he goes back alone after dark. He is knocked down and carried into a stream, and when he returns to the farm, he believes Pete hit him, though Meg and Ellen insist Pete has been in the room with them since Nath left. Before long, both Nath and Meg become obsessed with locating the elusive “red house” and vow to search the woods every Sunday, Nath’s only day off. Their quest yields no results, but it deepens their resolve and curiosity.
Meg begins to fall for Nath, even as Tibby Renton, Julie London — Nath’s jealous and calculating girlfriend — has her own plans for him. Meanwhile, Pete secretly grants local handyman and petty thug Teller, Rory Calhoun, hunting rights on the land in exchange for keeping trespassers away, a detail that foreshadows trouble to come.
A Sunday arrives when Nath cannot escape a date with Tibby, so Meg ventures into the woods alone to pursue the red house. She discovers it in a rocky ravine a few miles from the farm. As she races back toward safety, Teller fires several shots to deter her return. Meg tumbles down a slope and fractures her leg. That evening, Nath braves the woods to rescue her and carries her back to the house. Pete explodes with anger at their defiance, and when Nath is found visiting Meg in her bedroom, Pete fires him, banishing him from the farm and from Meg’s life.
Nath returns to town to work with his mother at the general store, and, urged by Nath, his mother soon marries a long-time admirer and heads off on a honeymoon for a few weeks, leaving Nath to run the shop. Nath also takes on extra work at Tibby’s family farm near town. With Meg recovering, Pete begins to unravel, growing domineering and delusional. In a quiet confession, Ellen and Pete reveal a painful secret: years earlier they rented the red house to a young couple. Pete had fallen in love with Jeannie, the wife, but she did not return his feelings. His obsession hardened into possession, and he killed Jeannie’s husband when the man returned, hiding their bodies in the basement of the ice house beside the red house. The couple moved away with their little girl Meg, whom Pete and Ellen later adopted after Jeannie and her husband disappeared.
As Nath confronts Tibby about her flirtations with Teller, he confronts Teller directly, and Tibby’s vanity becomes clear. Teller punches Nath, while Tibby witnesses with a sense of triumph. Teller and Tibby then begin to plot together, kissing in front of Nath as they move toward their own reckless course.
One evening Ellen, driven by fear and anger over the red house and its hold on Pete, tries to burn the place down. Teller misreads the danger and shoots Ellen, wounding her severely. Meg, alerted by the gunfire, finds Ellen and races to tell Pete. He refuses to help, and Meg calls Nath, who volunteers to bring a stretcher after he alerts the sheriff and the doctor. Pete resists Meg’s plea to return to the woods, but when Nath arrives, Ellen is already dead. Teller and Tibby’s plan unravels as Tibby discovers Teller intends to elope, but a highway patrol interception foils them; Teller is taken into custody while Tibby learns she has become entangled in a murder investigation.
Meg and Nath bring Ellen’s body back, and Meg presses for the truth about the red house and Jeannie. Pete confesses that Ellen kept his secret, that Jeannie—the woman he loved and who later married another man—had a child, Meg. The couple had planned to move away, but Pete’s obsession intensified as Jeannie’s husband returned; Pete killed Jeannie’s husband to keep the secret quiet and buried the bodies in the ice-house basement beside the red house. To protect Meg, Pete and Ellen raised her, but the truth now lies bare. In a tense moment, Nath slips out of the house with Pete’s rifle to pursue Teller.
Meg urges Pete to help stop Nath, and they drive toward the red house. Pete’s grip on reality slips further as he mistakes Meg for Jeannie, and he attempts to suffocate her in a cruel reprise of his past crime. Nath and the sheriff arrive at the crucial moment, forcing a confrontation. Pete tears away in his truck and crashes it into the ice house, which sinks into the pond below, taking Pete with it.
Back at the farm a few days later, Nath and Meg stand by the smoldering remains of the red house, which Nath has set alight to finish what Ellen began. They talk about starting anew, turning their attention toward a future together rather than revisiting the pain of the past, and the film closes on their cautious hope for a fresh start.
