Yorkshire, August 1918. The inhabitants of Hawkswick have seen soldiers moving through the night -- horrifically wounded soldiers who cannot possibly still be alive. Pets have gone missing from the village, and farm animals have been found slaughtered, as though blown apart from within by explosives which leave no scorch marks on their victims. Constable Albert Briggs has asked the government for help, and when a stranger named the Doctor arrives to investigate the strange events, Briggs assumes that he has been sent by the Ministry. The Doctor plays along with the misconception, and asks that his personal property, a large blue wooden box, be stored in the village jail for safekeeping. The village midwife, Mary Minett, picks up empathic emanations of pain from the box, and senses that there is more to the Doctor than he is saying. The Doctor claims to have spent the night at the railway station to save expenses, and Mary, attracted to the mysterious stranger and determined to find out who he really is, offers him her spare room.

Local farmer Bill Cromby blames the disturbances on the inhabitants of Hawkswick Hall, a convalescent home for shell-shocked soldiers. The Doctor visits the Hall and speaks with its director, Dr Banham, who is angered by the Doctor’s confrontational attitude and insists that his patients are not dangerous; he claims that the villagers are suffering from mass hysteria due to the war, and that as they aren’t familiar with the concept of mental illness, they can’t understand why men who appear physically fit are not off fighting in the trenches of Europe. Banham allows the Doctor to sit in on a therapy session, in which a soldier who has not spoken for months takes out his pain, frustration and rage on a humanoid clay figure, externalising and exorcising his personal demons. The Doctor apologises to Banham, apparently satisfied that he is doing good work -- but he appears strangely disappointed when Banham admits that some of his patients will never recover from the trauma they have experienced.

As the Doctor departs, he is contacted by Private Daniel Corey, a patient who claims to have the second sight -- and who believes that there is a great evil at the Hall, growing in strength. The Doctor returns to the village, where Briggs informs him that Cromby has found human remains in one of his fields, including the body of a corporal. Back in March, two men, including a corporal, went missing from Hawkswick Hall, but before a search could be mounted Banham reported that they had called him, claiming that they had simply discharged themselves and returned to their regiments. It now appears that he was lying, but why?

That night, something explodes in the village, and when the Doctor and Mary set off to investigate Mary sees the walking corpse of a soldier entering the woods. Briggs is lying unconscious near the ruins of his jail, and when he recovers, he claims to have seen dead men climbing through the wreckage. Whatever he saw, they would appear to have been attracted by the presence of the Doctor’s mysterious blue box, which remains unscathed by the explosion. The dead men return to the woods, where poacher Charlie Skaggs follows them to a tree from which the severed heads of the missing pets have been suspended. The dead men then surround the terrified Charlie, who shoots himself as they close in on him. Back at Hawkswick Hall, Banham is going over the false reports on the corporals’ disappearance when he finds clay sweating out of his pores. Corey sees the panic-stricken Banham running to the cellar, and follows him, only to be confronted and shot in the head by a dead soldier...

The next morning, a horrified young nurse finds Corey’s body lying in his bed, and Banham is forced to report the murder to Briggs. Briggs sends the Doctor to investigate, and when the Doctor finds undeniable proof that Corey was murdered elsewhere and his body moved, Banham reluctantly allows him to search the Hall for more evidence. The Doctor finds nothing and leaves, dissatisfied, and unaware that Banham was suffering a seizure in his office while the Doctor was studying a damp plaster wall in the cellar near the actual scene of the crime. Meanwhile, Briggs, Cromby and Mary search the woods for the missing Charlie Skaggs, and find his head hanging from the tree with the other dead animals. Cromby returns to his farm, where something is spooking his horses even though the barn appears to be empty. That night, he hears movement in the barn, and is nearly shot and killed by a dead soldier when he investigates. At the last moment his wife Iris shoots the dead soldier in the head, causing the body to disintegrate into earth. Later, Cromby evacuates his livestock from the barn and sets it on fire, and as he watches, the blazing bodies of dead soldier stumble out of the barn, crumbling to earth as they burn.

The Doctor believes that Banham knows more than he’s saying, but can’t work out why Corey’s body was moved to where it would attract more attention instead of being hidden. He breaks back into the Hall after dark to investigate further, and meets Corporal Davies, who leads the Doctor to a locked room in the cellar where he claims that Corey was shot by the golems who stalk the night around the Hall. Again, the Doctor finds no evidence of murder, and when he tries to break into the locked room he is caught by Banham. The furious Banham claims that the locked room is the Hall’s gun store, and orders the Doctor off the premises, threatening to report him to his Ministry if he continues to harass Banham’s patients.

The Doctor returns to Mary’s home, where he theorises that the gruesome tree in the forest is an Offering Tree -- a sacrifice to dark forces forgotten in this age of reason and enlightenment. The human race has lost much over the years, including instinctive powers such as Mary’s intense empathy with other living things, and some of those forgotten forces are very dangerous indeed. Mary, emboldened by their conversation and by a few too many glasses of port, tries once again to draw the Doctor out of himself; she knows that he is not from the Ministry at all, and that he was drawn here by sensationalistic newspaper stories about the sightings in the area. But why is a fit and healthy young man not fighting in the war in Europe, and how did he evade conscription, unless he was never registered to begin with? Where does this man with no past come from? Once again, the Doctor does not answer her questions. The next day, Mary -- hungover and embarrassed by her forwardness -- decides to make amends by visiting Hawkswick Hall herself, under the pretense of requesting medicines for her local practice. She manages to slip away to the cellar, where she breaks into the locked room to find a chamber with walls of clay; in the centre of the room is a chalk circle, within which she finds a book with Latin text and woodcuts of demonic horrors. Before she can leave, the door slams shut behind her, trapping her in the darkness...

The Doctor returns to the field where the soldiers’ bodies had been buried, and finds Corporal Sykes’ dog tags, proof that Banham was lying about his departure. He tries to take them back to Briggs, but is blown off his borrowed bicycle by an invisible explosion, and recovers hours later to find that the dogtags have been stolen. When he returns to Mary’s house he finds that she has still not returned, and takes Briggs to the Hall to demand an explanation. Banham has no choice but to open the locked room, but to the Doctor’s surprise the room revealed is a perfectly ordinary gun store. Once again Banham, barely in control of his rage, orders the Doctor to leave the Hall and not to return. The Doctor returns to Mary’s home as darkness falls, only to catch a glimpse of Mary apparently trapped in a mirror, calling for help. He is then attacked by a squad of corpse soldiers, who march him out into the yard and form a firing squad, preparing to execute him. Meanwhile, Bill and Iris Cromby hear movement in their yard; the dead soldiers have created more of their kind from the earth near the Offering Tree, and have returned, seeking revenge. Cromby disposes of most of the soldiers by rigging his barn with booby-traps and rigging his shotgun to the doors. He then kills two of the soldiers with his scythe, but the last remaining soldier overpowers him...

Briggs investigates the sound of gunfire at Mary’s home, and finds the Doctor alive and well; the soldiers are psychic manifestations, just as the intangible explosions have been, and the Doctor was able to resist their bullets through force of will. He now believes that Banham is not exorcising his patients’ internal demons, but storing them; the stress and madness of the war has released his patients’ latent psychic potential, and Banham has been channeling it for his own use. But the forces he has unleashed are too powerful for him to control, and the evil is now acting of its own accord. The Doctor and Briggs return to the Hall, where the Doctor, now understanding what is happening, uses his willpower to dissipate the illusion of the gun store and reveal the clay room as the demonic workshop it really is. Banham arrives and summons dead soldiers from the clay of the wall to overpower them, but the Doctor and Briggs take shelter within the chalk circle. Banham then releases Mary from the clay and orders the Doctor to surrender or see her die, but Briggs, enraged, overpowers his dead guard and shoots Banham. Banham’s death releases the forces he had barely been holding in check, and the Doctor, Briggs and Mary are instantly transported to a hellish netherworld -- the manifestation of Banham’s patients’ fear of the trenches.