Johnny Pye is adopted, and his parents, the miller and his wife, treat him rather harshly. They tell him that he is a fool, and beat him for his mistakes. Moreover, they tell him stories of the Fool-Killer, which frightens the young boy as he thinks that this cautionary figure is after him. Johnny runs away at the age of eleven, and ends up with a con man for a time, a man who uses his cleverness to get money quick with scams. Johnny leaves him after the con man is found out and tossed out of town, with no ill will but the understanding that this is not an entirely honest man—he hears the footsteps of the Fool-Killer. He then hires out to a variety of people as he searches for something inexplicable. He does a stint with a merchant, a time with the military, and tries to become educated. Then, he goes off to Washington to try to speak with the leaders of the country, as he figures that if anyone is untouchable by the Fool-Killer it would be them. Unfortunately, he finds that that is not the case, but he meets his old friend Susie Marsh from his hometown, and the two fall in love and decide to get married. Johnny also meets with the President, and his honesty prompts the President to assign him a job as Post Master in Martinsville. Johnny returns to his hometown and settles down with Susie. Just after their first child is born, he sees the Fool-Killer, an old scissors-grinder who sharpens a scythe on the side of the road. They start to talk and Johnny begs for his life. The man lets him off for now, and says that if Johnny can answer the question of how a man can be a human being and not a fool, that he will let him off permanently and give him eternal life.

The next time Johnny sees the scissors-grinder, it is just after the death of his eldest son, who drowned. This time Johnny tries to fight the scissors-grinder, but finds he can't. He asks to be taken, but the scissors-grinder refuses, and Johnny goes home. Time passes and Johnny grows old, outliving his wife. The next time he comes across the scissors-grinder, he is 92, and has shook hands with two Presidents, fifty years apart. He is finally able to answer the scissors-grinder's question, and he does acceptably. The scissors-grinder says that he can go free forever, but Johnny is now old and eternal life doesn't appeal to him. So he decides to die.