In Ancelstierre 's capital city, King Touchstone and Sabriel are attempting raise support against a corrupt politician's plan to relocate Southerling refugees across the Wall, which would lead to their certain death. Shortly after leaving the Old Kingdom embassy the motorcade is ambushed, and after an exchange of gunfire and explosions Sabriel and Touchstone are assumed dead.
Sameth and Lirael watch from the observatory at Abhorsen's House as hundreds of dead hands line the banks of the Ratterlin, led by Chlorr of the Mask. The Disreputable Dog suggests that an alternate way off the island may be found at the bottom of a Charter Magic-sealed well, though alludes to the possibility of an ancient free magic entity still residing at the bottom. Upon reaching the bottom of the seemingly endless well, Lirael, Sameth, Dog and Mogget hurry to find the way out before attracting too much attention. Dog suddenly urges the party to run as all Charter Magic suddenly fails, and Mogget has somehow been released from his collar. The unbound Mogget appears in front of an even brighter light in the shape of a woman with the river of death at its feet. As Dog tells them again to run, Lirael and Sameth are suddenly compelled into fleeing as fast as they can. Finally able to stop upon seeing daylight at the end of the passageway, they are rejoined by Dog who informs them that Mogget will not be joining them, and that the identity of the woman creature was none other than Astarael.
The trio of Lirael, Sameth and Dog find themselves at the bottom of the Long Cliffs, though there are steps carved into them to the west. After climbing for many hours to reach the top, the party finds the remains of a caravan of merchants being eaten by a Ferenk, a subterranean, scavenging creature of Free Magic. Dog deduces that the caravan was attacked by more dangerous Free Magic creatures, though they, as well as the Ferenk, have been nearly extinct for thousands of years. As they set out, Lirael and Sameth plan to use Charter Magic to bring down distant rain clouds from the north for cover and protection from Gore crows .
Meanwhile at Red Lake, Nicholas Sayre is still overseeing the excavation of the two silver hemispheres, which upon being dug up are unable to come within fifty feet of each other due to some unknown force. He plans to bring the hemispheres to Ancelstierre and use their uncanny attraction to lightning to generate electricity, like a power plant. The necromancer Hedge reports on the work to Nicholas, who is still unaware that the workers are Dead Hands inhabiting bodies of slaughtered Southerling refugees, when Hedge senses that the rain has been summoned by Charter Magic. Hedge wishes to find the summoners when a voice from within Nicholas tells him that there is no time to waste.
Lirael and Sameth are now on the ridge overlooking the pit where the excavation is happening when they are rejoined by Mogget. Mogget speaks cryptically about the encounter in the cave, saying only that Astarael just wanted to talk and gave Mogget another chance; he also refers to their adversary as “The Destroyer! The Unmaker! The Unraveler” though Dog instructs him not to say his true name. Lirael’s plan is for her and Dog to fly down to the camp and rescue Nicholas (Lirael in her Charter skin, and Dog using her shape-shifting ability to grow wings) and rendezvous with Sam and Mogget on the other side of a large and swift stream.
Nicholas awakes in his bed to find a talking owl and a dog with wings in his tent, believing himself to still be dreaming he does not listen to their warnings. As Lirael sheds her Charter skin, the dark power inside Nicholas begins to emerge, but is quelled by a Magic-infused bark from Dog. As the rescue attempt is discovered by Hedge and his dead servants, Lirael flees with Nicholas on her back while Dog stays to fight. Cut off from rejoining Sam and Mogget, Lirael hides in a boat concealed by the reeds of the lakeshore thus fulfilling the vision the Clayr had seen of Lirael. Nicholas is semi-conscious and more aware of what he has been a party to; he reveals his plans of the lightning farm to Lirael but loses control of the power inside him at her mention of the word “Abhorsen”. Having loaded the hemispheres onto barges, Hedge rejoins with Nicholas and heads off to Ancelstierre by sea.
After Lirael reunites with Sameth, Mogget, and Dog she tells them of Hedge’s plan and of Nicholas’ subconscious possession by the hemispheres. The Dog then feels obliged to tell Sameth and Lirael the true nature of what they face. The hemispheres are the imprisoned remains of Orannis, the most powerful of all Free Magic beings who opposed the Seven Bright Shiners' creation of the Charter. Mogget also reveals the he was there at the beginning of the Charter but did not chose sides, and was captured and bound to forever serve the Abhorsen for his neutrality. Lirael realizes that if they fail to stop Hedge from freeing Orannis, as neither the Disreputable Dog nor Mogget can remember the way the Seven Bright Shiners bound Orannis in the beginning, then she will have to go deep into Death and use the Dark Mirror to see the binding for herself.
Following a suggestion by Sameth, Lirael fashions an oversized owl Charter-skin to fly to the Wall while carrying Sam and Mogget. Upon arriving at the Wall they meet with the Perimeter Force disguised as returning scouts, but reveal themselves upon meeting the commanding officer, Major Greene. After being informed of the impending doom, Greene agrees to aid Lirael and Sam and informs them that Hedge has attacked a small garrison at the western end of the Wall.
Second Interlude: Sabriel and Touchstone make it to Wyverley College, hidden in the back of a mail truck. While there, they are updated on what is happening in the Old Kingdom in a letter from Princess Ellimere who has gathered the Royal Guard just north of the Wall. In order to get back to the Wall as fast as possible a student of Wyverly agrees to fly them in a biplane.
Part Three: Lirael and Sameth have been joined by a major part of the Ancelstierran forces guarding the Wall. The convoy of military vehicles stops a large distance from Hedge’s forces; the hemispheres, being themselves a source of Free Magic, prevent the Ancelstierran technology from functioning. There they are attacked by Dead Hands led by Chlorr. Lirael fends of the attack with her use of bells and Charter Magic but before she can finish Chlorr, Mogget taunts her to flee before the sound of Saraneth sends her beyond the final gate of death, and so she does.
With one last hope of getting to the lightning farm at Forwin Mill first by swinging around southwards, Lirael and company retreat to the convoy once more. Arriving near Forwin Mill they see that Hedge has already arrived, and the hemispheres are nearly in place. In addition, a large population of Southerling refugees is headed towards the lightning farm, having been lied to by the Ancelstierran government with promises of land at Forwin Mill. Lirael then resolves to go into Death, to the final gate, to witness the first binding of Orannis, while Sameth must stop the Southerlings from crossing the ridge between them and the lightning farm. While Sameth speaks to a Southerling Elder, Mogget sneaks into the lightning farm and rescues Nicholas Sayre, carrying him in his albino dwarf form.
Lirael makes her way deep into death with the Disreputable Dog at her side, encountering more dead spirits as she passes each gate. The Dog senses that they are being followed into death by Hedge, and they increase their pace. Upon reaching the Ninth Precinct of Death Lireal finds herself lost in the great starry sky above her. After a moment she realizes she is floating above the surface of the water and comes crashing down, having resisted the lure of the Final Gate. Lirael then begins to use her Dark Mirror and looks back to the beginning of the Charter and the binding of Orannis. Through the Dark Mirror, Lirael sees Orannis destroying six worlds before being stopped and bound on the seventh.
Just as Lirael begins to turn back towards life, she is attacked by Hedge who is taking careful precaution not to look at the stars above. While Lirael barely manages to defend herself, The Dog positions herself behind Hedge. Lirael lunges with all her strength and the necromancer tumbles over the Dog, causing him to look up at the star-filled sky. Hedge is suddenly entranced and is drawn up toward the sky, and the Final Gate.
While guarding Lirael’s lifeless body, Sam is struggling to hold off Shadow Hands with Lirael’s old panpipes. He is about to be overcome when Saraneth sounds from above, wielded by Sabriel in a paperwing. More paperwings land in the field, bearing the colors of the Clayr, the Abhorsen, and the Royal Family. Sabriel, Touchstone, Ellimere, Sanar and Ryelle join Sameth at the top of the ridge, as does Mogget with Nicholas in his arms. At that moment, the shard of hemisphere lodged in Nicholas’ body burst from his skin, completing the rejoining of the hemispheres, releasing the Destroyer, and killing Nicholas.
Lirael returns to life and instructs Sam to use his abilities as a Wallmaker to enhance her sword with the metal of the panpipes. Lirael instructs each of the assembled party to choose a bell that feels right, and after Orannis unleashes an extremely powerful explosion they cross the ridge towards the Destroyer. Surrounding the unbound Orannis, each of them rings their bell (with The Disreputable Dog’s bark standing in for the bell, Kibeth), when the binding begins to falter Sam releases Mogget from his collar. Mogget conquers his rage against the Abhorsens and adds his strength to the binding, succeeding in trapping Orannis in a sphere. In order to complete the binding, Lirael must split the sphere with her newly crafted sword at the cost of her own life, but as she splits the sphere Dog bites off her hand and absorbs the fatal force herself to spare Lirael.
Epilogue: Nicholas Sayre is standing in the First Precinct of Death feeling drawn to follow the current beyond the first gate, when he encounters the Disreputable Dog. The dog gives Nicholas a Charter Mark of his own to counterbalance the Free Magic that will continue to live on inside him, and sends him back towards life.