John Melmoth, a student in Dublin, visits his dying uncle. He finds a portrait of a mysterious ancestor called "Melmoth"; the portrait is dated 1646. At his uncle's funeral, John is told an old family story about a stranger called Stanton, who arrived looking for "Melmoth the Traveller" decades earlier.
A manuscript left by Stanton describes his first finding Melmoth laughing at the sight of two lovers who have been struck by lightning, and hearing of a wedding at which Melmoth was an uninvited guest: the bride died and the bridegroom went mad. Stanton's search for Melmoth is deemed to be madness and he is sent to a madhouse. Melmoth visits him there, and offers to free him, but Stanton refuses and escapes.
Following his uncle's wish, John burns the Melmoth portrait. He is visited by Melmoth in a dream, and later sees Melmoth laughing at a shipwreck. John tries to approach him, but slips and falls into the sea. He is saved from drowning by the sole survivor of the wreck, a Spaniard named Alonzo Monçada.
Alonzo Monçada tells his story (The Tale of the Spaniard), in which his family confines him to a monastery. He is mistreated by the monks, and his brother Juan arranges for him to escape with the help of a fellow monk, a parricide *the killing of a parent or close relative -TH). The escape plan is a trap and Juan is killed. Monçada is taken to the prison of the Inquisition. There he is visited in his cell by Melmoth, who says he will help him escape. A fire breaks out, and in the confusion Monçada escapes. He meets a venerable Jewish scholar, Adonijah, who lives in a secret chamber decorated with the skeletons of his own family. In exchange for food and shelter, Adonijah compels Monçada to transcribe a manuscript for him: the Tale of the Indians.
Isidora's father encounters a stranger at an inn who tells him the Tale of Guzman's Family. Guzman is a wealthy Spanish merchant whose sister marries a poor German musician, Walberg. Guzman decides to make Walberg's family his heirs, but his will leaves everything to the church, and the family sinks into poverty; almost insane, Walberg decides to end their poverty by killing them all – but before he does so news arrives that the true will has been found and the family is saved. By this point in the story, Isidora's father has fallen asleep, and wakes to find the stranger at the inn replaced by Melmoth.
Melmoth tells him the Lovers' Tale, about a young woman in Yorkshire named Elinor, who is jilted at the altar and is subsequently tempted by Melmoth, but refuses his help.
The Tale of the Indians resumes: Isidora returns to her family, but she is pregnant with Melmoth's child. She has a presentiment that she will not live, and gets Melmoth to promise that the child will be raised as a Christian. Isidora's father finds a husband for her, but in the middle of the wedding celebrations, Melmoth tries to abduct Isidora. Her brother tries to intervene, and Melmoth kills him. Isidora falls senseless and Melmoth escapes. Isidora reveals that she is already married, to Melmoth. She gives birth, but she and her baby daughter are imprisoned by the Inquisition. The inquisitors threaten to take away the child, but find that it is already dead. Isidora, dying of grief, remembers her island paradise, and asks if "he" will be in the heavenly paradise.
Monçada and John are interrupted by the appearance of Melmoth himself. He confesses to them his purpose on Earth, that his extended life is almost over, and that he has never been successful in tempting another into damnation: "I have traversed the world in the search, and no one to gain that world, would lose his own soul!" Melmoth has a dream of his own damnation, and of the salvation of Stanton, Walberg, Elinor, Isidora and Monçada. He asks John and Monçada to leave him alone for his last few hours of mortal existence. They hear terrible sounds from the room, but when they enter, the room is empty. They follow Melmoth's tracks to the top of a cliff, and see his handkerchief on a crag below them. "Exchanging looks of silent and unutterable horror", they return home.
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