Warning: Contains significant plot spoilers
David is residing with Aunt Betsey's lawyer, Mr. Wickfield and his daughter, Agnes. Wickfield's obsequious clerk, Uriah Heep, lurks malevolently on the margins. Meanwhile, David is apprenticed to another lawyer, Mr. Spenlow, who has a charming if flighty daughter, Dora.
Oblivious to the charms of Agnes, whom he treats as a sister, David falls in love with Dora and begins courting her, although her father disapproves. Unbeknownst to all, Heep has his eye on Agnes and on Wickfield's business.
By chance, David encounters his old schoolboy hero, Steerforth. Together they set forth to visit the ship house, where reside: David's old nanny, Peggotty; her taciturn husband, Barkis; Peggotty's fisherman brother, Daniel; his nephew, Ham; and Ham's cousin and fiancée, Little Em'ly.
Secretly enamored with Em'ly, the unscrupulous Steerforth convinces her to run away with him. Daniel sets out in hot pursuit, following them through many countries.
More villainy unfolds as Heep ruins not only Wickfield but also Aunt Betsey, who with Mr. Dick comes to live with David. Meanwhile, Micawber has reentered the picture as Heep's reluctant clerk.
Spenlow expires, leaving Dora penniless and hence a fitting match for the equally destitute David. They marry and David pursues his new career as an author, but Dora, too, soon dies.
All is not lost, for Micawber exposes Heep's financial fraud, restoring Aunt Betsey's wealth. And Daniel finally tracks down Em'ly, who has been abandoned to an appalling life by Steerforth.
Just as David arrives at the ship house with news of Em'ly's rescue, Ham dies in a storm while trying to rescue a drowning man, who turns out to be Steerforth.
Dickens ties up loose ends by seeing that David and Agnes are married; that the Micawbers, Daniel, and Em'ly start a new life in Australia; and that Aunt Betsey finally gets a niece.