The unnamed narrator of this story has found himself in quite the predicament. He's held hostage in a office building at the mercy of a gun-toting man who has planted bombs in several buildings around them, which are set to detonate in 2-1/2 minutes. Coming to terms with everything that is currently happening to him, the narrator remarks how all this is connected to a girl he knows: Marla Singer.
The narrator, whom will be named "Jack", reminiscences on the events that led to his current situation. Jack is an insomniac office worker who hasn't been able to sleep in six months. Working as an automobile recall specialist, Jack feels unfulfilled by his job and the luxuries it brings him. While talking to his doctor about his insomnia, his doctor, who doesn't take Jack's condition seriously, sarcastically suggests he attend a support group for men with testicular cancer to see people who are truly in pain. Jack takes his advice and attends the group, where he meets and befriends Robert Paulsen, another attendee. After crying with Robert, Jack finally has his first good sleep in months. He soon begins attending several different support groups, which serves as a form of therapy for him.
Just as Jack's life seems to be turning around, a wrench is thrown when another imposter, Marla Singer, begins attending the same support groups as him. Unnerved by Marla's presence, as it reminds him of his dishonesty, Jack's insomnia begins to resurface and he confronts Marla, pleading with her to attend the support groups on different days. Though indifferent to his plight, Marla begrudgingly agrees, and soon exchanges numbers with him. Jack attends several business trips, and while on a flight home, he comes across an enigmatic passenger: Tyler Durden, a soap salesman. The two have a brief conversation before Tyler makes his leave. Arriving at the airport, Jack discovers that his luggage has been confiscated as a potential bomb threat. When he arrives to his apartment building, he sees that his condo has been destroyed in an explosion.
Now homeless and with nothing, Jack at first calls Marla, but hangs up on her. He then calls Tyler, who invites him to a bar. At the bar, Tyler tells Jack that his life has been overtaken by consumerism. Leaving the bar, Tyler offers Jack to stay at his place, which he accepts. Before they head to Tyler's home, Tyler tells Jack to hit him as hard as he can. Jack complies, and the two have a small fistfight which they enjoy. The two arrive at Tyler's house: a dilapidated, abandoned mansion. Tyler and Jack begin to have small fights outside the bar every night. Their spars start attracting a crowd of other men, with some wanting in on the action. Eventually, Tyler and Jack establish the Fight Club, an underground men's fighting club that meets in the bar's basement. Tyler establishes some ground rules, with the most important one being that you do not talk about Fight Club. Fight Club soon becomes very popular, with multiple members joining.
One day, Jack receives a phone call from Marla, who admits she has just overdosed on Xanax pills. While Jack could care less about Marla's predicament, Tyler overhears her and comes to her aid. The two begin a sexual relationship and have rough sex almost every night, which annoys Jack. Jack receives a phone call from the detective agency, who reveals that the explosion that destroyed Jack's apartment was deliberate. Jack, at this point, could care less about what happened to his condo and feigns interest in having this case solved.
Tyler brings Jack with him to steal human fat from a liposuction clinic so that they can make soap. Afterwards, Tyler grabs Jack's hand and induces a chemical burn on it as a "rite of passage". As Jack writhes in pain, Tyler reveals he did the same thing to himself and forces Jack to agree never to go back to his past life, which Jack promises not to. At work, Jack is confronted by his boss over a document containing the Fight Club rules. Jack, however, manages to intimidate his boss into shutting up by threatening to shoot up the office. Jack receives a call from Marla, who thinks she has breast cancer, and goes to check on her. After confirming she's fine, he leaves and reunites with Robert, who reveals to have joined Fight Club.
During one Fight Club meeting, the owner of the bar, Lou, confronts Tyler and demands he quit operating his club underneath his bar. Tyler refuses, so Lou begins beating him senselessly, with Tyler laughing after each punch. Once he's done, Tyler pounces on Lou and spits blood on his face, demanding he keep Fight Club open. Lou, scared out of his wits, allows Tyler to continue operating his club before hightailing out of there. With that taken care of, Tyler gives the Fight Club members an assignment: to start a random fight with someone and deliberately lose.
Jack enters his boss' office and threatens to expose the company's corruption unless he allows Jack to work from home and pay him extra. Insulted, Jack's boss fires him and calls security to throw him out. Jack proceeds to beat himself up so that, when security arrives, it looks as if his boss attacked him. As a result, Jack is given the company's assets, which he uses to fund Fight Club. As more Fight Clubs spring across the nation, Tyler begins having the members commit acts of vandalism across the city. Tyler and Jack go to a convenience store, where Tyler forces the clerk outside at gunpoint. Tyler has the clerk confess that he wanted to be a veterinarian, and tells him to become a vet in six months or else. Jack is disturbed by Tyler's actions, but the latter assures that his actions are just.
Tyler begins recruiting Fight Club members to stay at his house, which confuses Jack. Coming home one day, Jack sees several members crowded around the TV. The news comes on, which reveals that the members have vandalized and set fire to an office building. Jack questions why they did that, and one of the members says they do not talk about "Project Mayhem", Fight Club's new name. During a press hearing, the police commissioner excuses himself to use the bathroom. Once he arrives there, he is ambushed by Fight Club, who were disguised as waiters. Tyler threatens to cut off the commissioner's balls unless he rescinds his investigation into their club. As the group leaves, Jack sees Tyler congratulate one of the members, "Angel Face", which makes him jealous. That night, he takes his anger out on "Angel Face" by beating him bloody.
Driving home, Jack confronts Tyler on why he hasn't been telling him about Project Mayhem's activities. Tyler rebukes that Project Mayhem is for everyone, not just the two of them. He tell Jack that he hasn't been living his new life to its full potential and begins driving into oncoming traffic. Jack takes the wheel from Tyler, and Tyler accuses him of still being attached to his past life, admitting that he was the one that blew up Jack's apartment. Jack decides to take his hands off the steering wheel, and the car crashes into another car. As they leave the wreckage, Tyler commends Jack for having a "near-life experience".
Jack awakens that morning to find that Tyler has disappeared. His house, however, is still active with Mayhem members making soap. Entering a room labeled "War", he asks around about Project Mayhem, but receives no answer. That night, Marla comes by, and Jack, assuming that she's looking for Tyler, tells her that Tyler's gone. As Marla leaves, Jack hears a commotion coming from inside and goes to investigate. He sees several wounded Mayhem members, who reveal that Robert was killed during a botched vandalism. As the members prepare to bury Robert to hide the evidence, Jack stops them, reminding them that Robert is a human being that deserves respect. The members begin chanting "His name is Robert Paulsen", which freaks Jack out.
Jack frantically goes through Tyler's room, where he discovers various phone numbers and airline ticket stubs. He travels around the country in an attempt to find Tyler but has no luck, only discovering that several Fight Clubs have formed around the nation. At one bar, the bartender addresses Jack as "sir", causing Jack to ask if the bartender knows him. The bartender reveals that Jack is Tyler Durden, so Jack goes to his hotel to call Marla. Asking Marla if they ever had sex, Marla confirms it and angrily refers to Jack as Tyler. Tyler appears in Jack's room, and Jack comes to the realization that he and Tyler are the same person. As Jack begins to relive memories of himself in Tyler's place, Tyler reveals that he's an alternate persona of Jack that was created to carry out the things Jack wanted to do. When Tyler tells Jack that Marla knows too much and needs to be dealt with, Jack passes out.
When Jack reawakens, he discovers that Tyler has made several outgoing phone calls. Arriving at Tyler's home, Jack discovers that Tyler was actually using the human fat they stole to make bombs and has planted them in several buildings. He calls the building supervisors to warn them about the bombs, only to discover that they're in on the plan. Remembering that Tyler wanted to get rid of Marla, Jack goes to her in an attempt to warn her. Marla, however, wants nothing to do with Jack at this point. Jack is able to convince Marla by handing her some money and telling her to leave the city, which she begrudgingly accepts.
Jack enters the precinct and confesses to being the founder of Fight Club. As he's interrogated, he explains that Tyler is targeting credit card companies in order to erase everyone's debts, which would certainly cause chaos. As the detective leaves to make a call, the other officers in the room are revealed to be Mayhem members, who were tasked by Tyler with stopping Jack. Jack flees from the officers and runs to one of the office buildings containing the bomb. He's taunted by Tyler as he approaches one of the bombs and disarms it. Enraged, Tyler beats Jack mercilessly before knocking him out.
Returning to where their story first started, Tyler attempts to convince Jack that what he's doing is something that Jack has always wanted to do. Looking outside, Jack sees that several Mayhem members have apprehended Marla, and pleads with Tyler to abandon his plan. Tyler adamantly refuses, arguing that he's saving the world from the evils of consumerism and unnecessary luxuries. As the two argue, Jack comes to realize that whatever Tyler's doing, he's actually doing. He's able to retrieve the gun from Tyler and points it at his own head. As Tyler continues taunting Jack, Jack shoots himself in the cheek, which kills Tyler by having the bullet exit out the back of his head.
The Mayhem members arrive with Marla in tow, with Jack telling them to leave Marla with him and go. Marla tends to Jack's wound, who assures her that she's fine. Suddenly, the bombs detonate and several office buildings begin to collapse. Jack tells Marla that she met him during a very strange time in his life, and the two hold hands as they watch the destruction.
