It is a time of social unrest in the village of Frankenstein. The residents feel they are under a curse and blame all their troubles on the Frankenstein Monster (Lon Chaney Jr.
). Rumors circulate about Ygor (Bela Lugosi
), who is still alive and supposedly trying to revive the Monster. The villagers pressure the Mayor into allowing them to destroy Frankenstein's castle. Ygor attempts to put up some resistance but the villagers rush the gates and begin to destroy the castle. Ygor, fleeing through the catacombs, finds the Monster, released from his sulfuric tomb by the explosions. The exposure to the sulfur weakened the Monster but also preserved him. Unseen by the villagers, Ygor and the Monster flee the castle to the surrounding countryside. There they encounter a powerful thunderstorm. The Monster is struck by a bolt of lightning, but, instead of being harmed by it, he seems to be rejuvenated. Ygor decides to find Ludwig, the second son of Frankenstein, to help the Monster.
Ludwig Frankenstein is a doctor who, along with his assistants Kettering and Bohmer, has a successful practice in Vasaria. Bohmer was formerly Frankenstein's teacher but made a tragic surgical mistake and now is relegated to being Frankenstein's envious assistant. Ygor and the Monster arrive in Vasaria and discover that Ludwig lives in a chateau at the end of town. The Monster quickly befriends a young girl, Cloestine Hussman, but their friendship is quickly ended by frightened and confused villagers, including the girl's father. The Monster returns the girl to her father and is immediately captured by the entire police force.
The town prosecutor, Erik Ernst, comes to Ludwig Frankenstein and asks him to examine the giant they have captured. Frankenstein says he will comply after he finishes some work. Soon, Ygor pays Frankenstein a visit, informing him that the giant at the police station is the Monster. Ygor implores the Doctor to heal the Monster's sick body and brain. Frankenstein refuses, not wanting the Monster to ruin his life like it did for his father and brother. Ygor threatens to reveal Ludwig's ancestry to the villagers and forces him to give in. After Ygor leaves, Frankenstein looks over the journals of his father and brother and tries to hide the purpose of Ygor's visit from his daughter, Elsa.
At the police station, the Monster is restrained with chains as a hearing is conducted to investigate the murder of the two villagers. The Monster does not respond to any questions. Doctor Frankenstein then arrives and the Monster shows signs of recognizing him. When Frankenstein denies knowing him, the Monster goes berserk and breaks free. Ygor leads the Monster away.
Elsa, alone in her father's study, finds the Frankenstein journals and reads them, learning the story of the Monster. She then sees the Monster and Ygor in the window and screams. Her father arrives and comforts her, telling her she was imagining it. Then, Ygor and the Monster break into Frankenstein's laboratory and the Monster kills Doctor Kettering. The Monster grabs Elsa, but Doctor Frankenstein is able to subdue him with knockout gas. When Elsa revives, Ludwig tells her of Kettering's death and promises her that he won't let this curse from the past separate them.
Frankenstein is examining his father's creation when the Monster revives and tries to kill him. The Doctor is able to tranquilize the Monster. Frankenstein then tries to enlist Bohmer's aid in dissecting the Monster, but Bohmer refuses, claiming it would be murder. Ludwig, however, is determined to destroy the Monster, even if he must do it alone. While studying his family's journals, Ludwig is visited by the ghost of his father, Henry Frankenstein. The spirit emplores him to perfect his creation rather than to destroy it. He advises Ludwig to correct the original mistake by giving the creature a good brain.
Ludwig calls in Bohmer and Ygor and tells them that he plans to put Kettering's brain into the Monster's skull. Ygor protests and asks Ludwig to use his brain instead. Frankenstein refuses and Ygor storms off. Ludwig charges the Monster to give him strength for the operation. Elsa protests to her father, telling him to stop his experiments but he refuses, choosing to operate on the patient as soon as possible. Ygor and the Monster are hidden in a secret chamber and as Ludwig arrives, Ygor explains to the Monster that he will receive a new brain. Ygor also taunts Bohmer, telling him that he shouldnt be subordinate to Frankenstein. Ygor promises to help the disgraced doctor if he agrees to put Ygor's brain into the Monster. Bohmer ponders the possibilities.
The police soon arrive at Frankenstein's house, searching for the Monster. They find the secret room, but Ygor and the Monster are now in the town. The Monster abducts Cloestine, his young friend, and returns with her in his arms to Frankenstein's chateau. The Monster's reason for abducting her soon becomes clear-he wants the girl's brain in his head. When Ygor protests, the Monster violently pushes him aside, injuring Ygors spine. Cloestine does not want to lose her brain and the Monster reluctantly gives her to Elsa. Doctor Frankenstein then performs the surgery believing he is putting Kettering's brain in the Monster. Bohmer, however, has substituted Ygor's brain for that of Kettering's.
In the village, Herr Hussman rouses his neighbors by telling them his daughter has been captured by the Monster and that Frankenstein is harboring the creature. They race to the chateau, blood on their minds. Erik Ernst is unable to stop them, but convinces the group to give him five minutes to convince Frankenstein to give up the Monster. Ludwig admits he has the Monster and agrees to show him to Erik, thinking Kettering's brain is in his skull. The Monster rises and Frankenstein is shocked to hear Ygor's voice come from the Monsters mouth.
The villagers now storm the chateau and the Monster decides to fill the house with gas to kill them. Frankenstein tries to stop him but the Monster repels the attack and mortally wounds the Doctor. The villagers find the Hussman girl and run from the building, fleeing the deadly gas. The Monster suddenly goes blind, as Ygors blood is incompatible with the Monster's and wont feed his senses. Enraged, the Monster kills Bohmer and then inadvertently sets fire to the chateau, bringing about his own demise. Erik and Elsa walk off toward the sunrise together.