Thomas Gradgrind, a leading citizen of Coketown, raises his daughter Louisa and son Tom to prize hard facts above soft sentiment. His friend Josiah Bounderby, shares the philosophy and applies it to running his bank and textile mills. But when a circus comes to town, it introduces the Gradgrind children to a new world of imagination, and a new companion—Sissy Jupe, a young performer whom their father adopts.

Encouraged by her father, Louisa reluctantly accepts Bounderby's marriage proposal. Enter Captain James Harthouse, a glib Parliamentarian offering Louisa relief from her loveless household. Meanwhile, Bounderby unfairly fires the honest Stephen Blackpool, who resolves to build a new life elsewhere. Before Stephen departs, Louisa visits, and Tom throws him a lifeline.

Bounderby and Gradgrind's fact-bound worlds come crashing down. After Bounderby's bank is robbed, the investigation focuses on the 'fugitive' Stephen Blackpool. However, Louisa suspects a perpetrator closer to home and closer to her heart. Then, Harthouse makes more than friendly advances toward Louisa, creating a profound crisis for her and a painful confrontation with her father.

Louisa's breakdown forces her father to reevaluate his worldview. From love for Louisa, Sissy delivers Harthouse an ultimatum. From rage, Bounderby delivers a different ultimatum to Louisa and Gradgrind. The town's search for Blackpool ends in tragedy. When the circus returns to Coketown, it is the setting wherein truth can finally emerge and Gradgrind can find hard-won wisdom.