Chief Bromden, the half-Indian narrator of One Flew Over the Cuckoo's Nest, has been a patient in an Oregon psychiatric hospital for fifteen years. During this time, he has pretended to be deaf and dumb. When he was a child, three government officials came to see his father about buying the tribe's land so they could build a hydroelectric dam. Bromden, ten years old at the time, was home alone. When he tried to speak to them, they acted as if he weren't there, sowing the seeds for his withdrawal into himself. Bromden's white mother joined forces with some of the members of the tribe to pressure Bromden's father to sell the land.
Bromden, like his father, is a big man who came to feel small and helpless. In the hospital, Bromden and several other male mental patients are under the domination of Nurse Ratched, a former army nurse who rules her ward with an iron hand. Like Bromden's mother, Ratched is a castrating female with a keen skill in making men ineffectual and weak. She uses subtle manipulation to keep the more docile patients under control. During the daily group meetings, she encourages the patients to attack each other in their weakest places. With the more rebellious patients, she resorts to electro-shock treatment and lobotomies to maintain her tyrannical control over the ward.
When Randle McMurphy arrives as a transfer from the Pendleton Work Camp, Bromden senses that something is different about this new patient. McMurphy waltzes into the ward and introduces himself to every patient as a gambling man with a zest for women and cards. After his first experience with the excruciating routine of the Group Meeting, McMurphy tells the patients that Nurse Ratched is a genuine "ball-cutter." The other patients tell him that there is no defying Nurse Ratched, because, in their eyes, she is an all-powerful force. True to his nature as a gambling man, McMurphy makes a bet with the other patients tha he can make Ratched lose her temper. At first, the confrontation between Ratched and McMurphy provides some humorous entertainment for the other patients. However, McMurphy's confrontation soon becomes their confrontation as he draws them into the conflict by encouraging their rebellion.
The success of his bet hinges on a failed vote to change the television schedule so they can watch the World Series. The Series was on television during the time allotted for cleaning chores; McMurphy and the other patients stage a protest by sitting in front of the blank television instead of doing their work. Nurse Ratched becomes hysterical and screams at them to return to their chores. The struggle between Ratched and McMurphy takes on the symbolic overtones of a mythological, cosmic battle. McMurphy learns that involuntarily-committed patients cannot leave the hospital without staff approval. Therefore, he cannot leave at the end of his original six-month sentence, but only when Nurse Ratched says he can.
He begins to submit to her authority. However, by this time, he has become the leader for the other patients. Their sanity, their claim to manhood lies in the balance. Cheswick, dismayed by McMurphy's surrender, commits suicide. Cheswick's suicide signals to McMurphy that he has unwittingly taken on the responsibility of rehabilitating the other patients. However, after protecting Big George from the cruelty of Ratched's aides, McMurphy is sent to Disturbed for electro-shock therapy.
The weight of his obligation to the other patients begins to wear away his strength and his sanity. Nevertheless, McMurphy arranges a fishing trip for himself and nine other patients. He guides them through the process of dealing with the hostility of the outside world and sets the stage for Billy Bibb it to lose his virginity by arranging a date between him and Candy Starr, a prostitute from Portland. When the other patients sense that McMurphy is weakening, they urge him to escape. He tells them he will leave early in the morning, after Billy has his date. He arranges a going-away party for himself.
While Billy finally enjoys the pleasures of sex with Candy, McMurphy and the other patients smoke marijuana and drink. However, when the time comes, McMurphy cannot bring himself to leave the hospital. Like the other patients, he has become unable to deal with the outside world. In the morning, Nurse Ratched finds out about their party and Billy's sexual encounter with Candy. When she threatens to tell Billy's mother, Billy becomes hysterical and commits suicide by slashing his throat.
McMurphy attacks Ratched; he rips open the front of her dress and tries to strangle her. In retaliation, she has him lobotomized. However, she has lost her tyrannical power over the ward. Her patients transfer to other wards or check themselves out of the hospital. Before he escapes from the hospital, Bromden suffocates McMurphy, so that he can die with some dignity rather than living out his life as a vegetable..