When police raid a house in a city north of New York, they discover a profoundly disturbing record of one man's ugly crimes. Investigators find over 800 videotapes shot by the killer which present a visual record of his murders in all their horrifying details. Both state and federal law enforcement teams sift through the gruesome images, looking for clues of his identity, the identity of his victims, and where he could have gone. Repeated viewings of the materials reveal little beyond the terrible facts of the crimes, and as the authorities comb through the madman's images, they find the tapes have had a disquieting effect on them.
The killer does not only capture the murders themselves, but the abductions, tortures and postmortem mutilations of his victims (along with bizarre fetishes involving balloons) all the while never allowing himself to be shown on film unless entirely disguised. Because the killer numbered the video tapes in order, investigators are able to determine that he started with the most vulnerable of victims: an 8 year old named Jennifer Gorman is abducted while playing in her front yard.
After the success of his first abduction and murder, the killer becomes less impulsive in his crimes. Carefully selecting the area in which he will strike next, he convinces a couple, the Andersons, that his car has broken down and they agree to give him a ride to a local gas station for aid. On the way, he clubs the male in the head and subdues the female using a cloth doused in a chemical solution while filming her face in close up. Investigators understand this would have taken considerable practice to achieve. The tape shows that the killer performed a C-section on the female, placing the severed head of her husband inside her womb before sewing her up again to later rouse her from unconsciousness and film her reaction. In the process of investigating the Andersons' disappearance, they come to realise the level of mutilation the killer is capable of, as well as his degree of premeditation. The killer made himself known in the CCTV footage of another gas station some time before the Andersons' abduction and murder, using sign language to give clues where he intends to dispose of one of the bodies.
It is then shown that the killer is stalking his next victim, the teenage Cheryl Dempsey. Taking advantage that she is alone with her boyfriend (Tim Surrey), he enters her house. After secretly walking through the house he places the camera where it cannot be seen and hides in a closet until he is ready to attack. Although he abducts Cheryl, he murders and mutilates Tim, leaving his corpse at the scene. It is only after the discovery of the tapes it becomes clear that this crime scene has been carefully arranged in order to obscure possible psychological profiling. Rather than killing Cheryl, he imprisons her in his basement, abusing her sexually, physically and psychologically as his "slave", a name he beats her into accepting as her new one. Cheryl's mother, Victoria Dempsey, appeals to her kidnapper in a televised statement. He then goes to see her, offering to help in finding Cheryl while filming her response. It dawns on Victoria that she is confronted with the man that has abducted her daughter, he merely chuckles and runs away while she is paralyzed with shock.
At this point the killer changes his modus operandi and begins targeting prostitutes while posing as a police officer. In his video record we are shown that in some cases he does not kill his victim directly, instead forcing Cheryl (now dressed in medieval style attire and rubber mask) to kill them. Because of the location in which he dumps the bodies and the level of mutilation they have suffered, the press now dub him "The Water Street Butcher". Forensic investigations discover several of the bodies are found to have the same sperm secretions. Using Ted Bundy's advice on a previous series of murders, authorities come to realize that the killer might indulge in necrophilia with his victims and should stake out areas where they find "fresh bodies" instead of making the discovery public. This is impossible as they can never find a fresh enough corpse.
Investigating one of the victims' apartments, police find fingerprints and saliva on an unwashed glass leading them to arrest former police officer James Foley. Because Foley has a history of visiting prostitutes, no alibi on the dates of the abductions, various evidence found within Foley's car, eye witness statements and matching sperm samples, he is convicted as The Water Street Butcher. Foley continues to plead his innocence and refuses to make any deals; he is sentenced to death in Pennsylvania. A few days after James' execution by lethal injection, one of the leading investigators finds a map in his mailbox letting him know they have "missed one" and the location of a new body. It becomes clear that the real killer had taken James Foley's sperm from a fertility clinic and meticulously framed him (making James Foley another of his victims by proxy). Foley is exonerated of the murders on September 12. Because of the close date to the 9/11 attacks, this goes unrecognized by the general public. The ever changing nature and variation of the murders means every psychological profile is contradicting. The Water Street murders continue.
Investigators trace the location of his house by records from a downloaded map of the area where one of the abductions takes place and raid the location. They find the house to be so clean that there are no fingerprints anywhere and no clues to the killer's identity. Along with the discovery of over 800 numbered video cassettes capturing several thousand hours chronicling his sadism, numerous dead bodies buried in the back yard (including the body of the original tenant), they find Cheryl Dempsey still alive, 8 years after her original abduction. She has been mentally abused to such an extent that she self harms and tortures herself in secret. Cheryl gives an interview where she says she believes her captor loves her and will return shortly to collect her. Soon after the interview, she commits suicide and in a note states her undying love for her "master". Not long after Cheryl is buried, her remains are mysteriously dug up and disappear.
Although only 27 of the cataloged videos are missing, numerous investigating officers are unable to find even the smallest hint as to the identity of the real Water Street Butcher. The tapes themselves become an essential part of the training for anyone learning criminal psychology. The Water Street murders cease and the case remains open, with authorities stating they will be keeping a close eye on places where the "documentary" will be aired as they believe the ego of the killer will not allow him to miss watching it.
In one last glimpse of the killer's sadistic nature, after the credits, a clip is shown of the face of one of his bound victims in close up. The killer taunts her by saying that he will make her a deal: he will release her unharmed if she does not blink. After a period of prolonged hyperventilation, the film ends as her eyes close.