The film opens during the Great Depression with two migrant workers arriving by bus at a ranch near Soledad, California. George Milton and Lennie Small are trying to attain their shared dream of settling down on their own piece of land. Lennie's part of the dream, which he never tires of hearing George describe, is merely to have soft rabbits on the farm, which he can pet. They are fleeing from their previous employment in Weed where they were run out of town after Lennie was accused of attempted rape when he touched a young woman's dress (prompted by his love of stroking soft things).
At the ranch, the dream appears to move closer to reality. Candy, the aged, one-handed ranch-hand, offers to pitch in with Lennie and George so they can buy the farm. The dream disappears when Lennie accidentally kills the young and attractive wife of Curley, the ranch owner's son, while trying to stroke her hair. A lynch mob led by Curley gathers. George, realizing he is doomed to a life of loneliness and despair like the rest of the migrant workers, and wanting to spare Lennie a painful death at the hands of the vengeful and violent Curley, George shoots Lennie in the back of the head before the mob can find him. The film closes with George reminiscing in a train boxcar.