Dark and evocative, this classic tale of horror opens with a sideshow barker drawing customers to visit the sideshow. A woman looks into a box to view a hidden occupant and screams. The barker explains that the horror in the box was once a beautiful and talented trapeze artist.
The central story is of this conniving trapeze artist Cleopatra, who seduces and marries sideshow midget Hans after learning of his large inheritance. At their wedding reception, the other "freaks" announce that they accept Cleopatra in spite of her being a "normal" outsider; they hold an initiation ceremony in which they pass a massive goblet of wine around the table while chanting, "We accept her, we accept her. One of us, one of us. Gooble-gobble, gooble-gobble."
The ceremony frightens the drunken Cleopatra, who accidentally reveals that she has been having an affair with Hercules, the strong man. She mocks the freaks, tosses the wine in their faces, and drives them away. Despite being humiliated, Hans remains with Cleopatra. Hans soon becomes ill. Cleopatra had poisoned his wedding wine, and she continues to slip poison into his medicine, planning to inherit his money and run away with Hercules.
Another circus performer, Venus, overhears the conspiring couple discussing the murder plot and tells Hans and the other freaks. In the film's climax, the freaks attack the evil pair during a storm, wielding guns, knives, and other sharp-edged weapons. Hercules is not seen again (the film's original ending had the freaks castrating him; the audience sees him later singing in falsetto). As for Cleopatra, she has become a grotesque, squawking "human duck". The flesh of her hands has been melted and deformed to look like duck feet and her lower half has been permanently tarred and feathered. She is the opening scene's cause for alarm.
In an ending MGM threw in later for a happier ending, Hans is living a millionaire's life in a mansion. Venus and her clown boyfriend Phroso visit, bringing Frieda, to whom Hans had been engaged before meeting Cleopatra. Hans refuses to see them, but they force their way past his servant. Frieda assures Hans that she knows he tried to stop the others from exacting revenge. Phroso and Venus leave, and Frieda comforts Hans when he starts to cry.