The book's protagonist is an English scientist and gentleman inventor, identified by a narrator simply as the Time Traveller. The narrator recounts the Traveller's lecture to his weekly dinner guests that time is simply a fourth dimension, and his demonstration of a tabletop model machine for travelling through it. He reveals that he has built a machine capable of carrying a person, and returns at dinner the following week to recount a remarkable tale, becoming the new narrator:
The Time Traveller tests his device with a journey that takes him to the year A.D. 802,701, where he meets the Eloi, a society of small, elegant, androgynous, and childlike people. They live in small communities within large and futuristic yet slowly deteriorating buildings, doing no work and eating a frugivorous diet. His efforts to communicate with them are hampered by their lack of curiosity or discipline, and he concludes that they are a peaceful communist society, the result of humanity conquering nature with technology, and subsequently evolving to adapt to an environment in which strength and intellect are no longer advantageous to survival.
Returning to the site where he arrived, the Time Traveller finds his time machine missing, and eventually figures out that it has been dragged by some unknown party into a nearby structure with heavy doors, locked from the inside. Later in the dark, he is approached menacingly by the Morlocks, pale, apelike people who live in darkness underground, where he discovers the machinery and industry that makes the above-ground paradise possible. He alters his theory, speculating that the human race has evolved into two species: the leisured classes have become the ineffectual Eloi, and the downtrodden working classes have become the brutish light-fearing Morlocks. Deducing that the Morlocks have taken his time machine, he explores the Morlock tunnels, learning that they feed on the Eloi. His revised analysis is that their relationship is not one of lords and servants but of livestock and ranchers, and with no real challenges facing either species. They have both lost the intelligence and character of Man at its peak.
Meanwhile, he saves an Eloi named Weena from drowning, and they develop an innocently affectionate relationship over the course of several days. He takes Weena with him on an expedition to a distant structure that turns out to be the remains of a museum, where he finds a fresh supply of matches and fashions a crude weapon against Morlocks, whom he fears he must fight to get back his machine. But the long and tiring journey back to Weena's home is too much for them, they are overcome by Morlocks in the night, and Weena is injured. The Traveller escapes only when a small fire he had left behind them to distract the Morlocks catches up to them as a forest fire; Weena is lost to the fire.
The Morlocks use the time machine as bait to ensnare the Traveller, not understanding that he will use it to escape. He travels further ahead to roughly 30 million years from his own time. There he sees some of the last living things on a dying Earth, menacing reddish crab-like creatures slowly wandering the blood-red beaches of a world covered in simple vegetation. He continues to make short jumps through time, seeing Earth's rotation gradually cease and the sun grow dimmer, and the world falling silent and freezing as the last degenerate living things die out.
Overwhelmed, he returns to his laboratory, at just three hours after he originally left. Interrupting dinner, he relates his adventures to his disbelieving visitors, producing as evidence two strange flowers Weena had put in his pocket. The original narrator takes over and relates that he returned to the Time Traveller's house the next day, finding him in final preparations for another journey. The Traveller promises to return in half an hour, but three years later, the narrator despairs of ever learning what became of him.