The Outsiders is about two weeks in the life of a 14-year-old boy. The novel tells the story of Ponyboy Curtis and his struggles with right and wrong in a society in which he believes that he is an outsider.
Ponyboy and his two brothers — Darrel (Darry), who is 20, and Sodapop, who is 16 — have recently lost their parents in an automobile accident. Pony and Soda are allowed to stay under Darry's guardianship as long as they all behave themselves. The boys are greasers, a class term that refers to the young men on the East Side, the poor side of town. The greasers' rivals are the Socs, short for Socials, who are the "West-side rich kids."
The story opens with Pony walking home alone from a movie; he is stopped by a gang of Socs who proceed to beat him up. The Socs badly injure and threaten to kill Ponyboy; however, some of his gang happen upon the scene and run the Socs off. This incident sets the tone for the rest of the story, because the event tells the reader that a fight between these two groups needs no provocation.
The next night Pony and two other gang members, Dallas Winston (Dally) and Johnny Cade, go to a drive-in movie. There they meet Sherri (Cherry) Valance and her friend Marcia, who have left their Soc boyfriends at the drive-in because the boys were drinking. Dally leaves after giving the girls a hard time, but another greaser, Two-Bit Mathews, joins Pony and Johnny. The boys offer to walk the girls home after the movie, but along the way, the girls' boyfriends reappear and threaten to fight the greasers. Cherry stops the fight from happening, and the girls leave with their boyfriends.
Pony and Johnny go to a vacant lot to hang out before heading home. They fall asleep, and when Johnny wakes Pony up it's 2 a.m. Pony runs home, because the time is way past his curfew, and Darry is waiting up. Darry is furious with Pony and, in the heat of the moment, he hits him. Pony runs out of the house and returns to the lot to find Johnny. Pony wants to run away, but instead they go to the park to cool off before heading back home.
At the park, Cherry's and Marcia's boyfriends reappear. Pony and Johnny are outnumbered, and the Socs grab Ponyboy and shove him face first into the fountain, holding his head under the water. Realizing that Ponyboy is drowning, Johnny panics, pulls his switchblade, and kills the Soc, Bob.
Ponyboy and Johnny seek out Dally for help in running away to avoid being arrested for Bob's murder. He gives them $50 and directions to a hideout outside of town. The boys hop a freight train and find the hideout where they are to wait until Dally comes for them. Hiding in an abandoned, rural church, they feel like real outsiders, with their greased, long hair and general hoody appearance. They both cut their hair, and Pony colors his for a disguise. They pass the time in the church playing cards and reading aloud from Gone with the Wind.
Dally shows up after a week, and takes them to the Dairy Queen in Windrixville. Thanks to Dally, the police think that the boys are headed for Texas. Dally also brings them the news that Cherry Valance is now being a spy for the greasers, and helping them out against the Socs. She has also testified that Bob was drunk the night of his death and that she was sure that the killing had been in self-defense.
Johnny decides that he has a chance now, and announces that he wants to turn himself in. They head back to the church and discover that it is on fire. A school group is there, apparently on some kind of outing, and little kids are trapped inside. Without thinking, Pony and Johnny race inside and rescue the kids. As they are handing the kids outside to Dally, the burning roof collapses. Pony barely escapes, but a piece of timber falls on Johnny, burning him badly and breaking his back. The boys, now viewed as heroes, are taken via ambulance back to town, where Pony reunites with his brothers.
Johnny dies of his injuries. Dally is overcome with grief, and he robs a grocery store. He flees the police and calls the gang from a telephone booth, asking them to pick him up in the vacant lot and take him to a hiding place. The police chase Dally to the lot, and as the gang watches, Dally pulls a "black object" from his waistband and the officers shoot him.
The senselessness of all the violent events traumatizes Pony, but he deals with his grief and frustration by writing this book for all of the "Dallys" in the world.