On the morning of September 17, 1799, Amasa Delano, the captain of an American sealer, looks out on the bay of St. Maria, a small, uninhabited island off Chile, and sees an unidentified ship moving clumsily toward the harbor. To assist the ship in safe passage, he travels by whale-boat to the vessel, a handsome Spanish trader now fallen into serious disrepair. His perusal of the ship's discipline finds no officers, numerous black slaves milling about and doing odd jobs, and the captain, Don Benito Cereno, too weak and nervous to do much more than what his black servant directs him. Cereno, who maintains a mysteriously evasive veneer, explains that his men and passengers have been depleted by scurvy, fever, and the buffeting of storms near Cape Horn. Unable to maneuver the San Dominick to safe mooring, they have been at the mercy of the sea. Captain Delano, observing unusual glances and ambiguous remarks from Spanish sailors, remains for a day to distribute much-needed water and food to the crew and provide material for sails.
At the end of the day, Delano, planning to lend a navigator from his own crew to help the ship on its way to Conception (currently spelled "Concepcion"), descends to his boat to return to the Bachelor's Delight. Don Benito, who has rejected Delano's offer of coffee aboard Delano's ship, suddenly leaps into the whale-boat and is soon followed by Babo, his black slave, who indicates with upraised dagger that he intends to kill his master. Delano realizes that Don Benito is a prisoner and that the peculiar circumstances aboard the San Dominick are an elaborate charade perpetrated by rebels to make him believe that Don Benito is still in charge.
Led by Delano's mate, the Americans take possession of the Spanish ship and render aid to the weakened captain. The next month in Lima, the assembly testify before a royal inquiry concerning the capture of the San Dominick. Don Benito states in his deposition that, in May of 1799, the San Dominick, on its way up the western coast of South America to Lima, was overrun by black slaves, who had been allowed to wander at will. The rebels, led by Babo and Atufal, ordered the murder of some passengers and all but six of the crew. They made an example of the slave dealer, Don Alexandro Aranda, whom they mutilated, stabbed, then stripped of flesh and nailed to the bow for a figurehead.
When the facts of the recapture of the San Dominick are revealed, Babo is identified, hanged, and burned. His severed head gazes from a pike above the plaza. Don Benito, unable to shake off the horror he has undergone, retires to a local monastery on Mount Agonia, where he dies three months later.