At the Somafree Institute, Dr. Hal Raglan humiliates his patient Mike by saying: "you're just a weak person. You must have got that from your mother. It probably would have been better for you if you had been born a girl!" On the dimly lit stage, Raglan demands a demonstration of anger, and Mike reveals angry red blotches covering his torso. The audience gasps. Raglan announces that this is psychoplasmcis; the physical manifestation of mental rage by the appearance of the welts on one's body.
Meanwhile, Frank Carveth collects his nine-year-old daughter Candy from a 'Private Guest Room'. Candy wears a red coat with fur trim and hood. Bathing her, Frank finds bruises and scratches on her back. He drives to the Somafree Institute to confront Raglan and demands to see his wife Nola, whom has been committed there. Raglan refuses. Frank accuses Nola of abusing their daughter and says he will stop Candy's next visit. Raglan threatens legal action if Frank withholds a vital part of Nola's treatment. Frank then goes to his lawyer, Al Resnikoff, who tells him that Nola has a stronger legal position despite the fact that she is committed to a mental hospital. Frank says that he will do what he has to. He takes Candy to her maternal grandmother, Juliana, who seems highly strung out.
Back at the institute, Raglan goes into Nola's room (play-acting as Candy) and he asks her why she hurt her daughter Candice. Raglan/Candice says: "Mummies don't hurt their own children". Nola sobs that they do. She tells Raglan that her own mother was "fucked up and bad". Raglan encourages her anger by telling her: "Go all the way through it, right to the end."
That evening at Juliana's house, she investigates a noise in the kitchen. Food, juice, glasses and dishes are thrown all over the floor. She is bludgeoned by what appears to be a small child wearing a red hooded raincoat with fur trim. As Candy watches from behind a door, small claw-like hands leaves bloodstains on the banisters. The next morning at his workplace, Frank is informed of Juliana's murder. Police psychologist Dr. Birkin tells Frank so encourage Candy to remember what happened, a breakdown is possible if she doesn't remember. "These things tend to express themselves in one way or another" says Dr. Birkin.
At the institute, Raglan speaks to Nola as her father. She quickly gets very angry saying: "You shouldn't have walked way when she hit me." Red welts appear on Nola's forehead as she speaks.
At the local airport, Frank and Candy meet Barton Kelly, Nola's estranged father, who has come for his ex-wife's funeral. On Resnikoff's advice, Frank visits Jan Hartog, an ex-Somafree patient taking legal action against Dr. Raglan. Uncovering a row of tumors on his neck, Hartog says bitterly: "Raglan encourages my body to revolt against me. And it did. I have a small revolution on my hands and I'm not putting it down very successfully."
Back at the institute, a drunk Barton Kelly arrives and is furious when Raglan will not allow him to see Nola. Meanwhile, Frank arrives at Candy's school where her teacher, Ruth Mayer, sits with her. Candy invites Ruth to dinner at her house. That evening, Ruth arrives and has dinner with Frank and Candy. A little later, Barton calls Frank from Juliana's house, saying he needs Frank's help to see Nola. Frank leaves Ruth babysitting Candy, who picks up a book to read which is titled 'The Shape Of Rage'. Raglan's book on Psychoplasmics.
At Juliana's house, Barton is alone when the same small figure wearing the hooded red raincoat emerges from under his bed and batters him to a very gory death with a pair of paperweights. Frank arrives a few minutes later and finds the body. The strange-looking "child" jumps on him like some aggressive animal, clawing at him until it suddenly falls off his back to the floor and seemingly dies. Frank picks up the phone to call the police. Back at Frank's house, Ruth Mayer answers a phone call from Nola calling from the institute, who then goes in a berserk rage when Ruth answers the phone and suspects that she is having an affair with her husband.
At the police station, Frank gives his statement and then meets the pathologist who performed the autopsy on the mysterious 'child creature' that attacked him where the doctor tells him that the creature died simply because: "it ran out of gas". Or more likely "its batteries expired". The pathologist points out that the creature has strange eyes, no sexual organs, and no navel. "This creature has never really been born... at least not the way human beings are born" says the pathologist.
Raglan (as Ruth Mayer) speaks to Nola, Raglan/Ruth says that Frank will divorce Nola and marry her. The jealous Nola screams to leave Frank alone. When Frank gets home from the police station, Ruth leaves in a hurry. He finds Candy cowering in a corner of her bedroom after a nightmare. He tells her that the 'thing' is dead.
The next morning, Raglan reads about Barton Kelly's murder. Taking a gun from his desk, he instructs his assistant, Chris, to get all the patients out of the institute. Meanwhile, Frank visits the hospital where Mike is now a fellow patient of Hartog's and is told that Nola is in fact the only patient at Somafree. Mike becomes angry about being dumped by his "daddy", his face becomes one giant red sore.
Frank takes Candy to school. In Ruth Mayer's art class, two 'children creatures' in pastel coats with hoods pick up wooden hammers and beat Ruth mercilessly to a gory death. Alerted by a boy's cries for help, Frank enters the classroom to find Ruth dead, and Candy gone.
At the institute, Raglan wakes Nola. She relates a dream that Candy was coming back to her, and says she doesn't feel threatened by Ruth Mayer any more. At the same time, Candy is being led along a snowy highway by the two creatures.
That evening, Mike turns up on Frank's doorstep raving about: "the disturbed kids in the work shed. The ones your wife's taking care of." Frank drives to the Somafree Institute where outside Raglan pulls a gun on him, saying they'll kill him if he tries to take Candy away from them. In a long monologue, Raglan tells Frank that the child creatures that have been doing all the killing are Nola's children. "Nola is not their surrogate mother, she's their real mother." They are the Brood; the parthenogenesis 'children' of Nola's rage. Over the past year-and-a-half Nola's psychoplasmics have manifested into these children which carry out her bidding whenever she's in an angry mood. Raglan tells Frank that Candy is locked up in the attic where the Brood are being kept, and that if he wants Candy back, Frank must go to Nola to convince her that he wants Candy back to live with him. If he can do that, the Brood will be neutral so Raglan can go into the attic and take Candy, if not... the Brood will attack as long as Nola is in a rage.
While Raglan waits outside the attic door where the Brood are being kept, Frank goes to Nola's room. He finds Nola rocking back and forth, wearing a white robe bathed in light. Nola wakes from her trance-like state and seems happy that he has come to see her. Frank says that he wants to be back with her. (Note: throughout the entire movie, Nola is only shown from the chest up which is apparently to hide something). At this point, Nola throws back her white robe, revealing an umbilical cord and external sac on her abdomen. The years of the welts that have appeared on her chest have merged together to create this womb outside her body as an incubator for the Brood that she produces. Frank recoils in horror and disgust.
In the attic, Raglan quietly enters where all the sleeping Brood lie in their bunk beds. He finds Candy in one and picks her up to carry her out. Just then, the Brood stirs, sensing Nola's mounting anger.
In Nola's room, she tears open the sac, removing a bloody 'infant' which she licks clean, as an animal might after having given birth. Frank's true feelings towards all this become apparent to Nola and her rage erupts.
In the attic, the Brood finally become active, leaping on Raglan, who manages to shoot a few of them, but he gets overwhelmed and beaten to death by the Brood. In Nola's room, she angrily tells Frank that she would see Candy die then let him take her away. Upstairs, the Brood then turn their attention to the petrified Candy who runs and locks herself in the closet room in the attic, but they break through the door to grab at her. Frank attacks Nola and strangles her to death with his bare hands to save Candy when he hears the noises coming from the attic. When Nola stops breathing, all is suddenly silent.
Frank goes upstairs to the attic to find all the Brood dead outside the room where Candy locked herself in, realizing that the Brood died without their mother's connection. Raglan is also dead nearby having been beaten to death and lying next to a few of the Brood he managed to kill before being overwhelmed. Candy is quivering in a corner of the room and Frank enters picks her up and tells her that he is taking her home. As Frank drives home with Candy, she seems to have withdrawn into a state of shock and cannot speak. Frank doesn't notice two raised lumps on her left arm... signs of her inner rage. The welts suggests that eventually like mother, like daughter...