Coraline Jones struggles to adapt to her new life after she and her workaholic parents move from Pontiac, Michigan to the Pink Palace Apartments in Ashland, Oregon. She meets the landlady's grandson, Wyborne "Wybie" Lovat, and a stray black cat. Later, Wybie gives her a button-eyed ragdoll from his grandmother's trunk that eerily resembles Coraline. The doll guides Coraline to a small door in her apartment with a bricked up wall behind it.

That night, a mouse leads Coraline back to the door, now a portal leading to a parallel universe, where Coraline meets her Other Mother and Father, button-eyed doppelgängers of her parents who appear more attentive and caring. She returns home the next morning, where Wybie recounts the disappearance of his great-aunt. Coraline's neighbors Sergei Alexander Bobinsky, an eccentric Chernobyl liquidator-turned-gymnast who owns a mouse circus, and retired burlesque actresses April Spink and Miriam Forcible cryptically warn her about imminent danger.

Despite the warnings, Coraline visits the Other World twice more. Accompanied by the mute Other Wybie, she is entertained by the dimension's doppelgängers of her neighbors and meets the cat, who can traverse between the two worlds and speaks in the Other World. On Coraline's third visit, the Other Mother offers to let her stay in the Other World permanently, in exchange for having buttons sewn over her eyes. Horrified, Coraline tries to escape back to her world, but the Other Mother imprisons her in a room behind a mirror.

There, the ghosts of past victims, including Wybie's great-aunt, tell Coraline how the Other Mother, whom they call the Beldam, used ragdolls of themselves to spy and lure them to the Other World. After accepting the Beldam's offer to sew buttons over their eyes, she robbed them of their souls. The ghosts explain that they can only be freed by retrieving the essences of their souls, which the Beldam has hidden throughout the Other World. Coraline promises to do so, and is rescued by the Other Wybie, who helps her return home.

Coraline realizes the Beldam has kidnapped her parents, forcing her to return to the Other World. Accompanied by the cat, Coraline proposes a game: if she can find her parents and the essences of the ghosts' souls, they will all go free; if not, she will finally accept the Beldam's offer. The Beldam agrees and Coraline searches for the souls' essences, discovering that the Beldam murdered the Other Wybie for his defiance. As she finds each essence, parts of the Other World turn lifeless as the entire dimension eventually disintegrates.