Hiking on a road on the Yorkshire moors of Northern England, American college students David Kessler and Jack Goodman come to a small village. They go into the local pub, called the Slaughtered Lamb, where they're coldly greeted by the locals. One of the regulars tells an off-color joke and while everyone, including David and Jack, laughs, Jack asks why the bar has a sort of shrine with candles and a pentacle. The bar is immediately silenced and the locals become even more unfriendly, prompting David and Jack to leave. Before they leave, the locals tell them to stay on the road outside and not to wander into the moors.
As Jack and David walk along the road it begins to rain and the fog surrounding them grows thicker. Subsequently, they drift off the road and find themselves disoriented on the moors. They hear the ominous baying of an animal in the distance and Jack suggests they return to the village. They then hear a low growling nearby and catch sight of a large animal, which is circling them. They hurry off in the opposite direction, only to find that the creature has flanked them. Hurrying faster, they break into a run and David trips and falls. While they laugh over David's accident and Jack helps him up, Jack is attacked by a large wolf, which savagely mutilates him. David had run off but runs back when he hears Jack screaming. He finds Jack's body ripped apart and is himself attacked by the wolf, which bites and scratches him on his face and shoulder. Gunshots are heard; the villagers from the Slaughtered Lamb have appeared and have shot the wolf. Before he falls unconscious, David sees the bloodied body of a naked man lying next to him.
David wakes up in a London hospital. His doctors and nurses inform him that he's been unconscious for three weeks since the attack and that Jack is dead. The police have also informed his parents about his condition. David is distraught at the thought of Jack's murder and the doctors sedate him. Later, he's visited by a chief of police and a representative from the American Consulate. The question him about the incident where Jack was killed. David doesn't have much to tell them except that Jack was killed by a large and powerful animal.The policeman tells David that he'd talked to the patrons of the Slaughtered Lamb and they'd told him that Jack was killed by a recently escaped murderer.
David begins to experience strange dreams that become nightmares; in one, he runs nude through the forest and comes to a bed. He sees himself lying in the bed; when the bedridden David opens his eyes, they appear animal-like and he snarls. After a few days in the hospital, David sees an apparition of Jack, still mutilated. Jack has come back as a spirit to warn David that they were attacked by a "lycanthrope" a werewolf. Worse, David will be doomed to transform into a werewolf himself at the next full moon, a few days from then. Jack also tells David that he must kill himself to break the werewolf's bloodline, or he may attack others and continue the cycle. Jack is incredulous, thinking that his trauma from the experience is affecting his mind. Jack assures him that the curse is very real.
One of David's nurses, Alex, becomes very attracted to David and invites him to stay with her at her London flat after he's released. The two become lovers. Late one night while Alex is asleep, David wakes up to use the bathroom. He is startled by Jack, whose spirit form has begun to decay. David is still unwilling to believe Jack's warning, even when Jack tells him that he may harm Alex. Jack disappears and David is left still believing he's losing his mind.
David is left alone in Alex' apartment when she goes to work. That night, David suddenly begins to scream in pain and he slowly transforms into a wolf. Loose in the city, he first stalks a man on the London Underground. The man hears David's growling and begins to walk quickly away, eventually running as David chases him. He makes it to an escalator and slips, and David kills the man. In another part of the city, David attacks a group of homeless men and kills them all. He also lures a couple out of their house and attacks another couple on the street killing them as well.
David wakes up, thinking he suffered another nightmare and finds that he's naked and in the wolf's pen at a zoo. He steals some balloons from a child & an overcoat from a woman. He rides back to Alex' flat on the Tube.
In the meantime, David's doctor, Hirsch, travels to East Proctor. Having been suspicious of David's wounds when he was admitted, Hirsch questions the townsfolk there, asking them why David's injuries were fully cleaned & dressed when they turned him over to the medical professionals. The townsfolk are reluctant to answer the doctor's questions, however, one of them meets the doctor outside the pub and tells him what happened and that David is cursed. The doctor returns to London and asks Alex about her new relationship with David. He tells her to keep an eye on him and that she might be in danger.
Alex and David go out for a day in London. While they're out, David spots a paper that tells of the murders he committed and how they're going unsolved. David realizes that Jack is right and tries to have himself arrested, even shouting statements that are offensive to Brits. Eventually he becomes so upset that he runs off, leaving Alex behind.
David winds up in a porno theatre at Piccadilly Square. Jack visits him again and introduces him to the ghosts of the people he murdered. They're all quite angry with David and all try to convince him to commit suicide immediately. David suddenly transforms into the wolf again and bursts out of the theatre, attacking people on the street and causing several violent car crashes. He's hunted by the police to a dead-end alley. Hirsch and Alex find him there and Alex tries to calm David down and help him transform back. With some recognition of Alex in his eyes, David leaps at her, feigning an attack. The police shoot him dead immediately.
2 american Backpackers are touring around europe and have arrived in a desolate part of the UK .
Before long they are warned by the Locals of The Slaughtered Lamb to avoid the moors at night.
Shortly afterwards they are attcked my a mysterious beast which kills one of them and wounds the other. the beast is subsequenlty killed by the locals and then the fun really begins.
After coming round in Hospital David meets Nurse Price and begins to have disturbing dreams .
He is visited by his now dead friend Jack who tells him that they were attacked by a Werewolf and that David will soon become one himself.
Shortly after leaving hospital and Moving in with Nurse price a Series of grisly Murders takes place .
And David realises that his dead best friend maybe right .