Prologue
Edward Fairfax Vere looks back on his life at sea as the captain of HMS Indomitable. He is haunted by his memories.
Act I
The crew of the HMS Indomitable go about their work. A passing merchant ship has provided three new recruits, among them Billy Budd, an open-hearted, good-natured young man. Questioned by John Claggart, the master-at-arms, Billy reveals a stammer. When he shouts farewell to his former ship, The Rights o’ Man, the officers mistakenly fear that he will encourage dissent on board. Claggart, who secretly despises the officers, is instructed to watch Billy closely. He orders his corporal Squeak to use every opportunity to provoke Billy.
A young novice has been brutally flogged. Dansker warns Billy to beware of Claggart. Alone with Captain Vere, the officers express their dislike of the French, whose ideas they hold responsible for recent naval mutinies. They warn that Billy is a potential troublemaker, but Vere disagrees with their assessment of the young man´s character. The ship enters enemy waters.
The crew sing sea shanties below decks. Billy discovers Squeak rummaging through his belongings as Claggart has ordered, and attacks him. Claggart intervenes and, to cover his own involvement, has Squeak arrested. Threatened by Claggart, the novice tries to trick Billy into leading a mutiny with the promise of French gold. The plan fails when Billy gets angry. Dansker repeats his warning to avoid Claggart, but Billy is certain he has nothing to fear from him.
Act II
Officers and crew are eager to engage the enemy. Claggart tells Vere there is a dangerous mutineer on board but he is interrupted when a French ship is sighted. Vere orders to give chase and the crew prepare for battle. A shot is fired but misses the target. The mist returns, putting an end to the pursuit.
Claggart reveals to Vere that it is Billy Budd who is planning mutiny. He produces as evidence the French gold he has given the novice to bribe Billy. Vere cannot believe Claggart and sends for Billy to confront his accuser.
Asked to defend himself, Billy gets so upset that his stammer chokes him. He strikes out at Claggart, killing him on the spot. Vere, shaken, summons his officers and a drumhead court is constituted. Billy admits the deed but cannot explain why Claggart should have wrongfully accused him. When the officers turn to Vere for an explanation, the captain refuses to respond. The court pronounces the death sentence.
Early the following morning, Billy contemplates his imminent death. Dansker appears with news that the ship is now indeed close to mutiny, the crew determined to prevent Billy’s execution. Billy tells him to stop them, for he has accepted his fate. He asks God to bless Vere before his death sentence is enacted before the entire crew.
Epilogue
The old Vere remembers Billy’s burial at sea and is haunted by the knowledge that he could have saved him.