A girl named Screw is on the phone and a call beeps in. The caller ID says "The Killer" and it's on a private line, and Screw answers saying "Dad?" The Killer asks her about scary movies and asks to play a game involving an intricate math problem. Screw hangs up and puts more icing on a giant cake behind her in the kitchen. She answers the phone again and gets a collect call from The Killer, who is now in the house. He tells her if she does not get the next question, she is dead. He asks her "who is buried in Grant's tomb?" She incorrectly answers Hugh Grant, and The Killer jumps out of the cake and chases her around the kitchen until the phone rings again. The Killer answers it and tells Screw "it's Stacy". Screw is then chased outside and runs to a bug zapper. The Killer then lights himself a cigarette and accidentally sets fire to his hockey mask. When the Killer puts out the fire by placing it in a bird bath filled with water, the melts into a 'scream' ghostface mask.
The next day, Dawson is registering for classes at Bulmia Falls High School, and "new kid" is taped to his back. Dawson then meets Martina, a goth girl; Slab, a dumb jock, Barbara, a mean girl, and Boner, the local geek who keeps telling people that his name is pronounced Bonner; "the 'o' is short". Martina tells the others about Screw's murder last night. Outside the school, the group sees local reporter Hagitha from Empty V News, who has written a book titled 'Dawson Is A Murderer', inspired by Dawson's family being murdered under mysterious circumstances while Dawson was at band camp the previous year. Dawson punches Hagitha when she wants to interview him about Screw's murder. Doughy, a mall security guard and Barbara's older half-brother, arrives and helps Hagitha up. Doughy briefly argues with Barbara and the others before they walk off to return to their classes. The janitor is seen sweeping up dead bodies off the floor (one of many silly sight gags throughout the movie).
In class, Martina gets a note (from the desk of The Killer) which says "I no what you did last summer." She corrects the typo on the note and thinks back to "last summer" when she and Barbara, Slab and Boner were out for a drive after Barbara won the junior prom queen crown when they hit a deer and they hid it in the woods. Martina remembers seeing a No Dumping sign and remembers that she forgot to give her grandmother her laxative.
In swimming class, the swimming instructor, Mr. Hasselhoff, has Boner act like the victim. The group makes fun of Boner and he passes out. He wakes up a few minutes later and receives a note in his swim trunks that reads: "I know what you did last semester". Boner recalls the hit-and-run of the deer that night with his friends and recalls as they were disposing of the deer in the woods, he remembers that he forgot to deliver a letter for his older brother who is on death row at the state prison about to be executed.
Between classes, Slab finds a note in his locker which reads: "I know what you did last Chanukah". He recalls the hit-and-run of the deer and remembers seeing a No Smoking sign in the woods and also recalls inadvertently smoking the ashes of his dead uncle on Chanukah.
Barbara finds a note in her bra which reads "I know what you did last period". She remembers the hit-and-run of the deer and then removed a tag from her rented prom dress that was not supposed to be removed.
The group is next seen having lunch in the school picnic area where Dawson finally gets his note (in his hamburger) which reads that "he may already be the victim". Dawson then thinks back to Labor Day weekend months earlier when, dressed as a deer, was pummeled by the four friends and dumped in the creek in the woods. Dawson reminds everyone that it is Halloween, and after coming up with possible reasons as to why anyone from the group would want to kill their friend, they agree to stay together and go to Slab's house that night.
A little later, Barbara is attacked by the masked Killer in the girls room, but gets away.
Slab is seen working on a car in the school garage. The Killer drives towards him in a red 1958 Plymouth Valmont as he screams against a wall, but the Killer is pulled over by a cop and given a ticket.
Martina is running around a track when the Killer appears behind her. He gets the lead over her and wins the track race.
Boner drills a hole in a wall to the girls locker room and peaks through to watch other schoolgirls showering when he instead sees the Killer showering. The Killer shoves a knife through the peak hole and Boner runs away.
In Sex Education class, Dawson goes to put fuel in the film projector. The Killer appears in the room, and jumps on him, but Dawson gets away.
Meanwhile, the Administrator-Formerly-Known-As-Principal is in his office enjoying soaking in a hot tub when The Killer arrives. The Administrator stands and is hit by something thrown though the window. He falls into the tub and is electrocuted.
That evening, Dawson, his friends, and a large group of people congregate at "the Deserted Location". Doughy is outside in a golf cart and Hagitha shows up in her news van with her new cameraman (after the last two were apparently murdered by The Killer).
While Martina gives the rules on how to survivor a "parody situation" The Killer arrives and heads upstairs where Boner is in a room with a drunk, sleeping female party guest. The Killer attacks with a chainsaw and chases Boner around the bedroom until Boner has a heart attack and flatlines.
Barbara goes to the refrigerator in the garage to get more beer for the party when The Killer shows up. She throws beer bottles and other items at the Killer. Barbara tries to crawl out of the doggie door to escape from the garage and The Killer activates a remote control to close the door, but a man outside the garage door is trying to use his own garage door opener and is making the door go up and down with Barbara stuck inside. Barbara is forced to pull out her breast implants and manages to get through. She runs with the Killer chasing her through a garden with a weed-whacker machine until she gets stung by a bee and dies.
In the house, the other people at the party leave after learning about the Administrator being found in his office dead. Alone, Dawson and Martina go to Slab's room to look for him where they see him overdosing after injecting himself she steroids and he explodes into tiny bloody pieces. The Killer arrives and chases Dawson and Martina around the house while Doughy, Hagitha, her cameraman, and a pizza delivery man play strip poker on a table outside. Martina finally punches the Killer and he falls down the stairs.
Dawson begins pulling off numerous masks from The Killer. Doughy, having heard a noise from the inside the house, goes inside to investigate with Hagitha. Dawson gets to the last mask and the Killer is revealed to be Doughy's evil twin cousin Hardy (looking exactly like Doughy exempt for a small mustache on his face). Doughy tells his cousin that he is a "disgrace" to the family and goes to hug him. Hardy is shot and killed by Hagitha using a gun as a mirror, and she accidentally shoots her cameraman dead as well, and leaves with the pizza guy.
The police arrive and take all the dead bodies away. Boner is revealed to be alive and taken away on a stretcher with an attractive nurse attending to him. The Killer is being taken away as well when he sits up only to be shot again by Doughy. Dawson asks Martina to go for "a walk in the dark scary woods" and she ignores her ringing phone. The Killer is seen on a nearby payphone and begins to follow the couple.