In his London studio, artist Basil Hallward puts the finishing touches on his latest portrait, that of a young man. Although Lord Henry, who is visiting with Basil, asks about the young man's identity, Basil declines to answer, noting his preference for secrecy. Basil never intends to exhibit the painting, because if he did, it would bare the deepest feelings in his soul. However, Basil lets slip that the subject of the portrait is Dorian Gray, who shortly thereafter pays the two men a house call.
Lord Henry immediately begins to influence Dorian, suggesting that he should treasure and guard his youth and beauty while he has them, because they will soon fade. Terrified of aging, Dorian wishes he could trade his soul to stay as young as he looks in the portrait; a short while later, he again wishes that he could stay young while the image in the painting aged. The portrait thus begins to take on a life-like existence; in fact, Basil's threat to burn the portrait is likened to "murder" and Basil prefers the company of the portrait to the real Dorian.
Dorian falls in love with a young actress, Sibyl Vane, a woman he barely knows. She plays a different woman at each night's performance, earning the label of "genius" from Dorian, who is as smitten with her acting more than with her personality. They become engaged, much to the surprise of Lord Henry and Basil.
The sweet, wholesome Sibyl discusses her engagement with her family. Because her mother is indebted to the theatre manager, Mr. Isaacs, for fifty pounds, she is against the marriage unless Dorian is wealthy; they do not know that he is. Sibyl's angry brother, James, is leaving for Australia, but he vows to kill Dorian if he wrongs his sister in any way. James also confronts his mother about gossip he has heard — that his mother and deceased father never married, which Mrs. Vane admits is true.
Dorian attends a performance of Sibyl's with Lord Henry and Basil, but the performance is terrible. Sibyl tells Dorian she can no longer act, because he has shown her a beautiful reality. Dorian is disgusted by her poor acting, because her performances were what drew him to her; he dismisses her and returns home. To his surprise, the portrait shows marks of cruelty around the mouth, lines that do not show on Dorian's face. He begins to suspect that his wish is coming true, so he vows to be good so that both he and the portrait can remain young. He, therefore, intends to apologize to Sibyl the next day and makes to marry her after all.
However, he is too late: Sibyl commits suicide at the theatre that night. Dorian first feels responsibility for her death, but then views it both as wonderful entertainment and a selfish act on her part. Lord Henry tries to keep Dorian's name out of the scandal. Dorian and Lord Henry spend the evening at the opera. The next morning, Basil arrives and expresses concern for Dorian, given the events of the previous day. Dorian, however, is completely unconcerned about Sibyl or her family; he wants to talk only of happy subjects. The next day, he covers his portrait and moves it to the attic, to which Dorian has the only key. He then settles in to read a yellow book sent by Lord Henry; the book becomes Dorian's blueprint for life.
Several years pass, and Dorian lives a hedonistic life according to the guidelines established by Lord Henry and the yellow book. While the face in the portrait has turned ugly, Dorian remains young, beautiful, and innocent. People talk about Dorian's "madness of pleasure" and his dreadful influence on the people around him, but that is of no consequence to him. Finally, when he is thirty-eight years old, Dorian shows the portrait to Basil, who begs Dorian to repent of his sin and ask that the wish be revoked. Instead, Dorian kills Basil and hides his body.
Blackmailing his old friend Alan Campbell, Dorian is able to dispose of Basil's body. An hour later, Dorian attends a party, but is bored and distracted. He then heads for an opium den and, out on the street, meets Sibyl's younger brother, who has been waiting for an opportunity to harm Dorian for nearly twenty years. Dorian makes a case for mistaken identity when he claims to have the face of a twenty-year-old and cannot be the man James is looking for. A woman in the street reveals that Dorian "sold himself to the devil for a pretty face," so James again pursues Dorian.
At his country estate one week later, Dorian entertains guests but believes James in hunting him. Dorian soon learns, however, that a man accidentally killed in a hunting accident is James, and so he feels safe.
The novel concludes six months later. Dorian and Lord Henry dine, and talk turns serious — Dorian talks of Basil, and Lord Henry reflects on a sermon he heard the previous Sunday while walking in the park. Lord Henry also inquires about the secret of Dorian's youth, which Dorian dismisses. Dorian then asks Lord Henry never to give the yellow book to anyone else. That evening, while Dorian examines the portrait, he decides to destroy it with the knife used to murder Basil. Soon after, Dorian's servants and a police officer find an old, ugly man lying dead on the ground in front of a portrait of a young and innocent Dorian.