On Christmas Eve, Pip, an orphan of about seven, encounters an escaped convict in the village churchyard while visiting the graves of his family. The convict scares Pip into stealing food for him, and a file to grind away his shackles, from the home he shares with his abusive older sister and her husband. The next day, soldiers recapture two convicts engaged in a fight and return them to the prison ship.
Miss Havisham, a wealthy spinster, asks Pip's Uncle Pumblechook to find a boy to play with her adopted daughter Estella. Pip begins to visit Miss Havisham and Estella, with whom he falls in love.
As a young apprentice at Joe Gargery's forge, Pip is approached by a lawyer, Mr. Jaggers, who tells him he is to receive a large sum of money from an anonymous benefactor and must leave for London immediately where he is to become a gentleman. Pip believes Miss Havisham to be his benefactress and visits her and Estella, who has returned from studying on the Continent.
With Pip now heavily in debt, his benefactor is revealed to be Abel Magwitch, the convict he helped, who was transported to New South Wales where he eventually became wealthy.
There is a warrant for Magwitch's arrest in England and he will be hanged if he is caught. A plan is therefore hatched for him to flee by boat. It is also revealed that Estella is the daughter of Magwitch and Mr Jaggers's housemaid, Molly, whom Jaggers defended in a murder charge and who gave up her daughter to be adopted by Miss Havisham.
Pip confronts Miss Havisham with Estella's history. Miss Havisham stands too close to the fire which ignites her dress and she eventually dies from her injuries.
While attempting to escape, Magwitch is captured and sent to jail where he dies shortly before his execution. Pip is about to be arrested for unpaid debts when he falls ill. Joe nurses him back to health and pays off his debts.