As the novel begins, Alec Leamas, the head of the Berlin station for the British secret service, waits at a checkpoint on the Berlin Wall for his agent Karl Riemeck, whose cover has been blown, to cross over to safety in the West. Riemeck’s mistress Elvira, who Leamas believes knows too much about the spy operation, crosses into West Berlin and tells Leamas that Riemeck will cross soon. As Leamas watches, Riemeck is shot and killed by the East German sentries. Riemeck is the last of Leamas’s agents in Berlin to be killed off by Hans-Dieter Mundt, the head of the East German secret service, the Abteilung.
Leamas is summoned back to London by Control, the head of the British intelligence agency called “the Circus.” Control tasks Leamas with one final mission before retiring: to kill Mundt. Leamas goes to Control’s house and meets with Peter Guillam and George Smiley, an agent and a former agent who worked on Mundt’s case back in 1959, when Mundt was a spy in London. Together the men hatch a plan.
To carry out the plan to kill Mundt, Leamas takes on a double identity. He is demoted to work in the banking department, where he becomes an alcoholic wreck, then disappears from the Circus entirely after being accused of stealing. Rumors circulate at the Circus that Leamas’s pension will be small, because of an interruption in his service after World War Two.
After leaving the Circus, Leamas lives in a squalid apartment, drinking too much and not socializing with anyone. He is sent by Mr. Pitt, a man at an employment agency whom he thinks he recognizes, to work at a library. There he meets a young Jewish woman and member of the Communist party named Liz Gold. They have an affair and Liz falls in love with Leamas. One night, she can tell that he is preparing to do something and that they must say goodbye. The next day, Leamas punches Ford, a grocer who refuses him credit, and goes to jail for three months.
When Leamas gets out of prison, he is approached by East German spies in London, Ashe and Kiever, who recruit him as a defector. They say he will get fifteen-thousand pounds now and another five thousand in a year for information he gives about his service. Leamas travels to The Hague, where he is interviewed by a Russian agent named Peters. Leamas tells Peters about how he first made contact with Karl Riemeck and about the intelligence Riemeck provided. Peters is skeptical that Riemeck would have had access to so much information. Leamas learns from Riemeck that Elvira was killed in West Germany, which puzzles him.
The next day, Leamas tells Peters about a special system for paying an agent that he worked on while in the Banking Department. For this operation, called Rolling Stone, Leamas opened joint accounts in Helsinki and Copenhagen. In each city, he deposited money into a joint account for himself under an alias and an agent who could collect it under an alias.
On the third day in Holland, Peters arrives late, so Leamas takes a walk on the beach. He thinks about Liz and how she made him remember what it feels like to take pleasure in life. He hopes to return to her. When Peters arrives, he tells Leamas that there is a wanted ad in the London papers for Leamas’s arrest. Leamas accuses Peters of having revealed his defection to London to force him to stay, but he actually suspects that Control is behind this. Peters tells him he must go to the East for his own safety and to be interrogated further, and they fly to Berlin.
Back in London, George Smiley and another agent visit Liz. They ask her questions about her relationship with Leamas. Smiley leaves Liz his card and tells her to be in touch if she needs anything.
Meanwhile, at a lodge outside Berlin, Leamas meets Fiedler, the second in command at the Abteilung and its best interrogator. Leamas is familiar with Fiedler’s dossier, and knows him to be merciless about killing to defend his Communist ideology. In planning to destroy Mundt, Control is counting on Fiedler to collect the evidence about Mundt (once Leamas frames him) and prosecute a case against his boss.
Fiedler and Leamas spend days walking through the hills, during which Fiedler asks Leamas about the details of his service and about his philosophy. Leamas steadfastly denies that he believes in anything. Fiedler is sure that Rolling Stone was meant to pay a spy working for the British in East Germany, but Leamas says that it would have been impossible for the British to run an agent there without his knowing. To try to determine which agent was paid through the Rolling Stone operation, Fiedler has Leamas write to the two banks to inquire about the accounts. He gets word back that the money was withdrawn from the bank in Copenhagen on days when Mundt traveled to that city.
Back in England, Liz receives an invitation to travel to Leipzig on a cultural exchange with another branch of the Communist party. She finds it odd that the Party would take special notice of someone as insignificant as her, but puts her doubts aside, hoping that the trip will take her mind off Leamas.
Leamas and Fiedler return to the lodge, after a drive during which Fiedler tells Leamas that he suspects Mundt of being a British agent. When they arrive they are arrested. Leamas resists arrest and kills a German sentry before being knocked unconscious. He wakes up in a prison, badly beaten and tied up. Mundt interrogates him, demanding to know the details of the British plot to frame him. Mundt says that Leamas could be shown mercy for murdering the sentry, if he testifies that Fiedler is part of a British plot to frame Mundt. Leamas does not confess. Mundt asks him over and over when the last time he saw George Smiley was, when suddenly a number of people rush into the room. Mundt is arrested and Leamas is brought to a hospital.
When Leamas wakes up, Fiedler is standing at his bedside. Fiedler tells him that he had already submitted a report on his suspicions about Mundt to the Praesidium (legislative committee) when Mundt had them arrested, and now there will be a Tribunal to determine if Mundt is a British spy. Leamas will have to testify.
Meanwhile, in Leipzig, Liz is enjoying her visit until she is disappointed by how sparsely attended the Branch Meeting is. After the meeting, a man named Holten comes and tells Liz that her itinerary has changed and that he will bring her to a special meeting on the Polish border. Liz goes with him.
The Tribunal takes place in a small courtroom, overseen by three members of the Praesidium. First Fiedler presents the case against Mundt, explaining that Mundt was caught by the British while in London and turned into a British spy. He calls on Leamas to testify, but first explains that Mundt recruited Riemeck to be his intermediary with Leamas, so Leamas is unaware that Mundt was a British agent. Fiedler calls for Mundt to be sentenced to death.
Next, Mundt’s defender, Karden, speaks. He contends that Leamas was sent by the British to bring down Mundt with Fiedler’s help. He calls on Leamas to testify and asks whether he was friendless and penniless when he defected. Leamas affirms this. Karden asks if George Smiley might have wanted to help him and Leamas says no. Karden then asks for his witness to be brought in.
To Leamas’s shock and horror, Liz enters the courtroom. Liz is terrified and wants to protect Leamas, but she does not know what the trial is about. She testifies that George Smiley visited her after Leamas went away, and provides evidence that Leamas was not as broke as he says he was. Karden says that this proves that Leamas’s defection was staged by London. Leamas is flabbergasted that London compromised his mission by contacting Liz. To try to save Fiedler and Liz, he testifies that Karden is right: the whole thing was a set-up. It is not until he has finished his testimony that he realizes the truth: Mundt really is London’s man, and London sent him on this mission to frame and kill Fiedler, who suspected Mundt, and to protect Mundt.
Later that night, Mundt comes to the prison cell where Liz is being held and ushers her out into the night, where Leamas is waiting by a car. They drive towards Berlin. Leamas explains to Liz the way London used them to achieve its end, and Liz is horrified. They pick up a man who gives them instructions for how to climb over Berlin Wall without being shot by the sentries. Liz wonders why she has been let go: she is a Communist who knows the Circus’s secrets.
At the Berlin Wall, Leamas climbs to the top and then reaches back down to lift Liz over. Then searchlights come on, and Liz is shot several times. From the Western side of the Berlin Wall, Leamas hears George Smiley calling for him to come across. Instead, Leamas climbs back down to the Eastern side, where Liz lies dead, and he too is shot by the sentries.