Reed Richards is working in his laboratory on a secret project when the Thing unexpectedly enters. Jhonny and Sue Storm try to distract Ben, but he senses that they are trying to keep something from him and he picks a fight with the Human Torch. Reed ends the fight with a fire extinguisher, but when he tries to explain why he did not what Ben in the lab, Ben angrily departs. Reed tells Sue to follow Ben invisibly, and she soon overtakes him and tries to persuade him to return with her. She remains invisible as they talk, and soon some bystanders become aware of the odd conversation that the Thing is carrying on. Two men make fun of Ben for talking to himself, but a sudden kick from the Invisible Girl bowls one of them over. The Thing wraps a lamppost around the other.
Then Sue happens to see a man climbing on the top of a near by bridge. Fearing he may be killed, she fires a 4 signal flare to alert Reed and Johnny at Baster Building. Reed spies the man with his binoculars, but he cannot strength to the bridge to save him. Johnny ignites and flashes to the bridge. When he approaches the man, he sees the man's eyes are glazed, as though he is entranced. At the same time, in another part of the city, a sinister craftsman gloating manipulates a tiny figure along a scale model of the same bridge, the man in the trance falls from the real bridge. When the Torch catches the man, the craftsman mysteriously receives a burn on his finger. Thus the craftsman, who is known as the Puppet Master, learns that the Human Torch thwarted his plan. Therefore, he thinks, The Torch must become his next victim.
The Puppet Master's stepdaughter, Alicia, runs into the room when she hears his outcry. Telling her it is no concerns of hers, he warns her never to call him father. He is her stepfather, the says. Because she is blind, she cannot see what he is going. He never told her that some time ago he discovered a deposit of radioactive clay with a strange power. If he carved a piece of the clay into a miniature image of a person, he could mentally control the person's actions by manipulating the model. He started to use the clay in a monomaniacal quest for power.
The Puppet Master carves a puppet of the Thing and places it into a replica of his own workshop. Soon Ben Grimm, compelled by the clay's power, walks into the Puppet Master's house. Sue is still with him, Invisible, but the blind Alicia's sharp hearing senses Sue's heartbeat and breathing. When she tells her stepfather that there are two more people in the room, he quickly infers the Invisible Girl's presence. After placing gas masks on himself, Alicia, and the Thing, he fills the room with ether. Sue tries to escape, but the windows are locked. She asks The Thing to help, but she is overcome by fumes and sinks unconscious to the floor. No longer in control of her invisibility, she becomes visible again.
The puppet master gloats at how easily he defeated two of the Fantastic four. Seeing how closely Sue resembles Alicia, he duplicates costume and a blonde wig for Alicia to disguise her as Sue. He tells her she will play a little prank for him. When she wonders what he has in mind, he tells her not to question, just to obey. She runs her sensitive fingers over the hypnotized Thing's face, and remarks that the face feels strong but also gentle, even tragic, and sensitive. The Puppet Master is uninterested in her insight. Placing a hammer in Ben's hand, he commands him to crush it, which he does. With the Thing's mind completely under his control, the Puppet Master tells the disguised Alicia to stay by the Thing's side and say nothing. After the Thing and Alicia leave, the Puppet Master removers a puppet of the personal trustee of the warden of State Prison from his collection of clay figures. Placing it behind a miniature replica of the warden's desk, the Puppet Master skilfully manipulates it on strings like a marionette. Slowly, the puppet opens the model desk drawer and removes the tiny keys. And soon. Warden Williams of State Prison discovers the keys to the prison are missing from his desk.
At the Baxter Building, Reed tell Johnny that his experiment is almost finished. Now all he needs is to have the Thing present. A warning buzzer announces an arrival , and Johnny sees the Thing and what appears to be Sue on the television monitor. Before Johnny can leave the monitor, The Thing enters, grabs him by the collar, and flings him across the room. Reed can see by Ben's expression that something has happened to him, and he lures him into his laboratory toward a vial of the potion that he just created. The Thing slams into a workbench and the vial breaks, drenching him. In moments he changes into his human form. No longer resembling the Puppet Master's model, Ben snaps out of his trance. Elated, Ben asks Reed what happened, and Reed replies that he was working on the chemical earlier that day. He did not what Ben to know what he was doing, lest Ben suffer another disappointment. Ben apologies to Reed and Jonny; he thought Reed was scheming against him. Then they turn their attention to the young woman disguised as Sue, whom Ben identifies as the Puppet Master's blind stepdaughter. As Bends holds her in his arms, she senses that he still the strong, kindly Thing, but in a different form. As she touches his face, Reed's chemical wears off, and Ben regains his grotesque features. Alicia joyfully says that now he is the same, wonderful man that he was. Ben is troubled indeed because Alicia seems to like him ore in his monstrous form.
The warden's trustee at State Prison, still in the thrall of the Puppet Master, inserts the keys he stole into the electric lock that automatically opens all the prison doors. As the Puppet Master manipulates the dozens of puppets of the prisoners, Sue recovers from the gas. With the Puppet Master occupied, she quietly turns invisible and tries to escape, but a creaky floorboard betrays her. The Puppet Master swiftly removes a puppet of the Invisible Girl from the box and grasps it firmly by the ankles. Sue's feet suddenly stick together, and she falls just as she reaches the door. She fires a 4 signal flare, and her three team masters speed to her aid in the Fantastic Car, when they enter the Puppet Master's chamber , he sends a giant, mentally controlled puppet to battle them as he takes Sue hostage and escapes. Reed tries to bind the huge figure with his elastic body, but it is the Thing who finally defeats it, smashing it with a powerful blow. They chase the Puppet Master to the top story of his building, but he launches himself and Sue from the window on the back of a winged puppet horse. Reed manages to extend his body and snatch Sue out of the saddle, but the Puppet Master ignites a rocket engine in his mount and streaks away. Not even the Torch can catch him. When the Torch returns to the building, his flame fades and Reed has to snatch him out of thin air.
A radio bulletin alerts the Fantastic Four to a riot at the State Prison. Quickly deducing that the Puppet Master is responsible they take off in the Fantasticar. When they arrive, they find the thugs covered, but they can do nothing without jeopardizing the warden. To break this stalemate , The Torch burns through the prison wall and tunnels under where the warden is being held, then he bursts through the floor and rescues the warden. Although their hostage is gone, the prisoners remain confident that they can shoot their way to freedom with the guns they obtained when they were let loose.
The Thing tears a section out of the prison wall, scattering convits like tenpins, the Thing fastens several prison doors together into a makeshift cage and then corrals most of the escapees within. A small group of convicts armed with automatic weapons remain free. They shoot at Mr. Fantastic, but his elastic body simply catches the bullets and snaps them back. Reed sweeps away their weapons with an extended arm as the Torch encircles them with flame. The Invisible Girl holds the last escapee at bay with a pistol, which appears to the convict to be floating in mid air. The warden and the guards take the convicts into custody.
Alicia returns home to await her stepfather. She did not realize that he is such a menace, and she does not know what she will do when he returns. When he arrives he describes his greatest creation to the apprehensive Alicia, a puppet of himself, dressed in regal outfit as if he were the ruler of the world. Having successfully tested his power, he says he will use it to control armies, nations, anything. He says he will tear down the United Nations Building and make slaves of the Fantastic Four. Suddenly Alicia runs at her stepfather, saying that no one should ever have such power. The puppet flies from the Puppet Master's hand, and when he tries to catch it, he trips over Alicia's hand and falls out the window to the street below, presumably to his death. Moments later, the Fantastic Four arrive, and Alicia, in tears, embrace by the Thing. Sue asks what made the Puppet Master fall. Reed sees the puppet on the floor and wonder whether they will ever know.