Grace is the young supervisor of Short Term 12, a group home for troubled teenagers. She lives with her long-term boyfriend and coworker, Mason, but finds it difficult to open up to him emotionally. When Grace finds out she is pregnant, she schedules an appointment for an abortion; she eventually tells an overjoyed Mason about the pregnancy, but not about her plan to have an abortion. At the facility, Grace and Mason focus their efforts on Marcus, a Short Term 12 resident who is about to turn 18 and is struggling with the prospect of leaving the facility.
Grace bonds with Jayden, a recent arrival at Short Term 12 who has a history of self-harm. Jayden distances herself from the other teenagers as she does not intend to stay at the facility for long, and when her father fails to pick her up on her birthday, she reacts violently towards the staff. After her outburst, she sits in the "cool-down room" with Grace, who shows Jayden her own scars from cutting herself. That night, Jayden leaves the facility in the middle of her birthday celebrations and, unable to force her to return, Grace follows Jayden to her father's house. After finding the house empty, they return to Short Term 12. When Jayden reads Grace a cryptic story she has written, Grace begins to suspect that Jayden was abused by her father.
At a party hosted by Mason's foster parents, he proposes to Grace, who accepts. The following morning, Grace is upset by a phone call that reveals her father is being released from prison, and refuses to be consoled by Mason. She arrives at Short Term 12 to discover that Jayden has been picked up by her father overnight. She is angry at the decision to send Jayden back to her father, but her boss maintains that Jayden denied that she was abused by him. Later that day, Grace finds that Marcus has attempted to commit suicide after the death of his fish.
While waiting at the hospital as Marcus is being treated, Grace breaks down and Mason becomes upset with her for refusing to talk to him about how she feels; instead, she tells him that she no longer wants to marry him and that she plans to have an abortion. Upset, she returns to Jayden's father's house and breaks in, intending to injure him while he sleeps, but she is interrupted by Jayden, who suggests that they smash his car instead. Grace opens up to Jayden about being sexually abused by her own father, and after Jayden shows Grace bruises from where her father hit her they return together to Short Term 12, where Jayden reports her father for physical abuse. Grace goes home to apologize to Mason, who tells her that Marcus will recover.
Several weeks later, Grace starts seeing a therapist and she is shown viewing a sonogram with Mason. Mason tells the rest of the staff about running into Marcus, who is doing well and has a girlfriend.