In Arizona, Phoenix, Marion Crane tells her boyfriend, Sam Loomis, about getting married. One day, while doing her job, she stole $40, 000 from her boss and drives away.
At one night, Marion gets into trouble with a police officer who is suspicious of her agitated behavior. He lets her go, but follows her while she's driving. Knowing this, Marion switches her car with a different one.
One rainy night, she stops into a motel, Bates Motel, for the night. She tries to call on the owner of the motel by honking the horn of her car. Norman Bates arrives and tells her to go inside his office. When she asks him if he has a vacancy, Norman replies that he has 12 vacancies and gives her a key to room 1.
Inside, he tells Marion to have dinner with him, but it is nothing special about that, and leaves. While she is trying to hide the money she stole, Marion hears the argument between Norman and his mother, who refuses to allow him to have dinner with her.
Because of that, Norman decided to have dinner with Marion at his office. In his office, Norman tells Marion about his taxidermy skills and his mother.
Back at her motel room, Marion takes a shower. While doing so, she is stabbed to death by a mysterious figure.
Norman comes screaming that his mother is cover with blood and runs to Marion's room to find her murdered. He begins to clean up the mess and throw away her body and possessions (including the money) to the river.
The next day, Sam is contacted by Lila, Marion's sister, about her disappearance. Just then, Detective Milton Arbogast came to them and reveals that he is hired by Marion's boss to get his money back. He suggested that they work together to find her.
Arbogast goes to the Bates Motel to question Norman about Marion's disappearance. Suspecting that his mother is responsible, Norman tries to protect her by lying through Arbogast's questions. While questioning Norman, Arbogast sees a figure sitting in a chair and asks him who is it. Norman replies that it is his mother.
The detective calls Sam and Lila that he is planning to go to Norman's house to meet his mother. However, he is stabbed to death by the same figure while doing so.
Because of Arbogast's disappearance, Sam and Lila go to Deputy Sheriff Al Chambers, who tells them that Norman's mother is dead 10 years ago. He contacts Norman if there is any trouble and the reply is that there is no trouble. Chambers is puzzled about the figure in Norman's house.
Knowing that his mother will be in trouble, Norman hides his mother to the fruit cellar, which something she doesn't like to hide.
The next day, posing as a married couple, Sam and Lila check in to the Bates Motel and search Marion's room where they find the paper written $40, 000. Sam distracts Norman while Lila searches his house for his mother. However, the conversation between Norman and Sam becomes sour when the latter suggested that the former killed Marion to get her money and buy a new motel. Realizing that Lila is missing, Norman knocks Sam unconscious and goes to his house.
Marion hides to the basement as Norman goes upstairs. In the basement, she sees the corpse of Norman's mother and Norman comes to her dressed with a wig and dress, and holding a knife. He tries to kill her, but Sam restrains Norman.
In a police station, Dr. Fred Richmond, a psychiatrist, reveals Norman's origins. He reveals to Sam and Lila that he got the story not from Norman, but his mother's split personality, and that she completely took over Norman from the beginning.
It is revealed that when Norman was a kid, he is abused by his mother. After the death of his father, Norman and his mother lived together as if they were the only people in the world. When his mother gets a lover, Norman becomes jealous as he thinks that she pushed him away for her lover. Enraged, Norman poisons his mother and her lover. However, because he is dominated by his mother, Norman steals her corpse and preserved it. This explains of how Norman gets the split personality of his mother. While he is his mother, Norman would act like she was. Because Norman is jealous of his mother for having a lover, his mother would be jealous of him for having a lover. For Richmond's case, Marion. Because Norman is aroused by her, he wanted to have her, but his mother personality wouldn't allow that so Norman kills Marion under her influence. Then Norman, unaware of his mother's personality, cleans up the mess.
When Sam asks Richmond why is Norman dressed as his mother, Richmond replies that this is to keep the illusion of his mother being alive to stay alive.
Richmond concludes that if a mind has two personalities, there is always a battle between them. For Norman's case, his mother's personality has won. When Sam asks him about the money, Richmond replies that the money is a crime of passion, not profit.
In a cell, Norman, as his mother, thinks about how is he gonna be blamed for the murders and he will prove that he is harmless by refusing to swat a fly in his hand. As he makes an evil grin, a hot is shown of Marion's car being carried from the swamp.