A man staggers towards the River Thames, wearing ragged clothes and a strange metal helmet. He screams, tearing the straps off the helmet, walks into the river, and drowns himself. Near the same spot, the TARDIS materialises, the Doctor surmising from the surroundings that they have landed in London. Ian and Barbara are delighted they have returned home at last, but it is a curiously silent and deserted London. The Doctor is concerned about the decay they see around them and wonders about what year it is, fearing that it is nowhere near Ian and Barbara's time. Susan tries to look over a wall, but slips and twists her ankle, at the same time that the bridge under which the TARDIS has materialised collapses, burying the TARDIS and blocking the travellers' access to it. The Doctor and Ian decide to look around in a nearby warehouse for tools to help unblock the TARDIS door. Barbara remains behind to look after Susan.
Exploring the abandoned warehouse, Ian and the Doctor are unaware they are being watched. From a window, Ian spies Battersea Power Station with its chimneys damaged, while the Doctor finds a calendar marked 2164. Barbara, who went to the river to soak a handkerchief for Susan's ankle, returns to find her gone and a dirty-faced man there instead. The man tells Barbara that they have to get out of there before they get killed, and that Susan has been taken by someone called Tyler. He urges Barbara to follow him, as the sound of automatic fire is heard in the distance. Meanwhile, in the warehouse, the Doctor and Ian stumble across a corpse wearing the same strange metal helmet seen earlier. They also find an electronic receiver attached to the helmet and a whip on the body, and discover that the man has been stabbed to death. They decide to return to the others and spy a flying saucer hovering over the city.
Barbara is still following the unnamed man across the ruins of London. Tyler carries Susan down a flight of steps into an empty Underground station as Barbara catches up. Susan and Barbara demand that they find their other friends, but Tyler says that there is no time. Tyler activates a secret panel and David Campbell emerges from it, telling Tyler that he had a struggle with a Roboman and that they will have to tell Dortmun to change the storehouse. He also reveals that he saw the Doctor and Ian in the warehouse but thought they were enemies. Dortmun, a man in a wheelchair, arrives, and Tyler tells him that a saucer has landed at the heliport. Dortmun says that this time they will be ready for "them." Dortmun is glad to see Susan and Barbara, as extra sets of hands, especially since Barbara can cook. David goes to find the Doctor and Ian; Dortmun asks him not to be long, as they need to go through the attack plans. Tyler takes Susan and Barbara below while Dortmun stays on watch, armed only with a knife.
Ian and the Doctor have arrived back at the TARDIS to find the women gone. Ian finds a poster forbidding the dumping of bodies in the river and muses, "Bring out your dead..." Was there a plague in the city? David spots the Doctor and Ian from a window, but he also sees several Robomen converging on their position. The Doctor and Ian find themselves surrounded, but the Robomen only tell them to stop in flat tones. The two try and run for it, but turn only to see, rising from the Thames, the distinctive form of a Dalek.
The Dalek orders that the Doctor and Ian be brought to the landing area. It warns the Doctor that resistance is useless and that the Daleks have already conquered the Earth. In the resistance base, the humans listen to Dalek propaganda broadcasts demanding their surrender. A young woman called Jenny tends to Susan's ankle while Barbara prepares food. Tyler and Dortmun debate about whether the humans are capable of attacking the Dalek saucer with the numbers they have. Dortmun shows off a new acid bomb that he has created, which he is confident will shatter the Dalek casings. David returns, reporting the capture of the Doctor and Ian. They have been taken to the heliport at Chelsea.
Ian is confused, as they saw the Daleks destroyed on Skaro. The Doctor explains that Skaro was a million years in the future — what they are witnessing now is the middle period of Dalek history. Dalek guards usher the prisoners into the saucer. One human tries to escape and is exterminated. Back at the resistance base, David explains that the Daleks operate on some of their human prisoners and turn them into Robomen, but the transfer operation is unstable and eventually the Robomen go insane and commit suicide. The saucer is where the transfer operations take place. Meanwhile, on the saucer the Doctor and Ian are put in a cell together with another prisoner, Craddock. Ian asks him how the invasion happened. Ten years before, meteorites brought a plague to Earth, splitting the Earth into small communities and making humans unable to resist six months later when the Dalek saucers landed. Some survivors were turned into Robomen, others destroyed or sent to the mining areas in Bedfordshire. Craddock does not know, however, what the Daleks want out of the ground.
The resistance plans the assault. Barbara suggests using the Robomen helmets as a disguise to get them close enough to use Dortmun's bombs. Meanwhile, the Doctor attempts to manipulate a device inside the cell, which he suspects to contain a key to the door. However, what he does not realise is that the device is an intelligence test. The Daleks have been observing him remotely, having earlier adjudged him more intelligent that the other humans from his earlier remarks. Solving the lock confirms their assessment, and the Doctor is taken away to be robotised. The Doctor is placed on a transfer table as outside the saucer, the resistance forces gather.
Tyler's attack group arrives, disguised as Robomen and prisoners. Susan, David and Barbara start throwing bombs from a nearby building. Tyler's group enters the saucer to try and free the prisoners while outside the Daleks scramble to mount a defence. Members of the group carry the unconscious Doctor away from the transfer table rush out of the saucer with the prisoners, using the bombs to cover their escape. The bombs, however, are ineffective. Dalek blasts and gunfire mix with the chaos of dying men as they scramble away. In the confusion, Barbara is injured and Ian remains behind on the saucer. Tyler is separated from the Doctor — he tells Dortmun back at the base that he is going to search for survivors of the raid and then leave London. Dortmun wants to go to the Civic Transport Museum, another gathering place, to get supplies so he can continue working on his bombs. Barbara and Jenny agree to go with him.
In the saucer, the Black Dalek relays an order from Supreme Command to destroy London with firebombs. The saucer lifts off, on its way to the mines. Ian emerges from his hiding place, only to bump into a robotised Craddock, who is escorting a prisoner for transfer. Ian struggles with Craddock, who stumbles against the transfer machinery and is electrocuted. The man introduces himself as Larry — he had stolen aboard the saucer in order to hitch a ride to Bedfordshire to find his brother. They get rid of Craddock's body via a disposal chute.
David and Susan hide from Dalek patrols, and listen in horror as the sounds of extermination echo around them. Susan wishes she could just go back to the TARDIS and get out of here, and suggests that she could persuade her grandfather to take David along. David tells her that running away does not solve all problems, and besides, Earth is his planet and he cannot abandon it. Susan thinks about how she has never had a place she could call home or her own identity. David says that someday she will. Suddenly, they hear a noise — Baker, carrying the drugged Doctor. Baker says he will be heading for the Cornish coast, but, just as he leaves the others, he is intercepted and exterminated by a Dalek patrol.
On the streets of London, deserted except for Daleks, Jenny, Barbara and Dortmun avoid patrols in several iconic London locations (the Victoria Embankment, Westminster Bridge, Trafalgar Square and the Albert Memorial) and make it to the museum. There, Dortmun finds his notes and determines the fault was not with the bombs but with the dalekanium casings of the Daleks. He comes up with a new formula for the acid bomb, and wants Barbara to take his notes to the Doctor. Barbara tells him he can give it to the Doctor himself, but once she leaves the room, Dortmun leaves his notes behind and goes outside to try the new bombs against the Daleks himself. He calls out defiantly to the Daleks, throwing a bomb at them as they exterminate him. However, the new bomb fails to make an impact. Jenny and Barbara make their escape.
The Doctor begins to get feeling back in his legs. Susan tells him that David suggests heading North to meet with a resistance group there but the Doctor says that he they should try to reach the TARDIS, tetchily observing that Susan seems to trust David's word over his. Susan protests that it is simply because David knows this time better. David returns, saying that there are patrols everywhere, and asks the Doctor for his advice as he is the senior member of the party. Somewhat mollified by the gesture of respect, the Doctor "suggests" to David that they make their way North. Susan is pleased. Hidden in the saucer, Larry tells Ian of his brother Phil's theory that the Daleks want the magnetic core of Earth. The saucer finally lands and the Daleks disembark with their new workers and the Roboman guards. Ian and Larry leave through the disposal chute and make for the nearest tunnel. Back in London, two Robomen place a Dalek firebomb near the Doctor, Susan and David's hiding place, and it begins to tick down.
The Doctor passes out, leaving David and Susan to defuse the firebomb on their own. David uses acid from one of Dortmun's bombs to burn through the casing, and removes the timing mechanism before it can trigger the explosive. David suggests they leave the Doctor behind for the moment while they search for a way through the sewers out of London. Susan does not like the idea of leaving the Doctor alone but David says they have no choice. Meanwhile, Barbara and Jenny fix up a lorry from the museum in preparation to drive up to Bedfordshire. There, Larry and Ian are moving through the countryside, spotting a group of human slaves pulling a carriage of metal parts towards a mine shaft and hearing the sounds of machinery. Trying to get under cover, they meet a man called Wells, who thinks they are escaped workers. He tries to cover for them, however, when a Roboman comes to take them for selection to be robotised. Ian and Larry help Wells when the Roboman attacks him, and knocks the Roboman out. Wells tells them he was here to meet Ashton, a black marketeer. Ian wants to meet Ashton, hoping he has a way to get him back to London. Wells tells Ian that the Daleks have destroyed the city.
In London, Barbara and Jenny ride out of the museum in the lorry, past Dortmun's corpse. They run a roadblock, Barbara crashing the lorry through the Daleks, but their position is reported back to the saucer, which gives orders to intercept them. Jenny and Barbara manage to leap out of the lorry before it is destroyed by the saucer. David and Susan move through the sewers, where they meet Tyler, who warns them of alligators in the sewers. Susan hopes that she will never become as cynical as Tyler, but David says that one day it will be all over and they can rebuild the planet from the start. Susan finds the idea of a fresh start exciting. While exploring, Susan nearly falls into the jaws of an alligator, but Tyler and David manage to rescue her. They climb out of the sewers, Tyler having found the Doctor who has now recovered. In Bedfordshire, Larry and Ian avoid the monstrous Slyther, the pet of the Black Dalek, and while hiding, meet Ashton. Ian asks if Ashton can take him to London, but Ashton refuses unless Ian can pay in gold or other precious metals. Wells arrives, trading jewellery for food, but the Slyther attacks as they are eating. Ashton is killed, while the Slyther approaches Larry and Ian, who are trapped on the edge of a sheer drop.
The two jump into a mining bucket suspended over the pit, and although the Slyther tries to jump after them, Ian hits it with a rock and causes it to fall to its death. Before Ian and Larry can climb out of the bucket, it starts to descend. In London, Robomen pursue the Doctor and his party back into the sewers. Tyler and David lay an ambush, and manage to subdue them. Meanwhile, Jenny and Barbara find a hovel in the countryside with two women, seeking shelter from a storm. The women are left alone by the Daleks because they make clothes for the slave workers in exchange for food. Barbara offers them food in exchange for staying the night. The older woman sends the younger one to deliver clothes, but she has actually gone to bring the Daleks, who capture Jenny and Barbara.
Ian and Larry finally reach the bottom of the shaft, and jump down the last twelve feet before the bucket tips over. Larry injures his knee as he falls, however. As he hides, Ian looks around, puzzled that the mine only seems to be made for shifting rocks and not processing ore. Larry repeats his brother's theory that the Daleks are after the Earth's core. Trying to blend in with a working party, they are confronted by a Roboman — Larry's brother Phil. Larry pleads with Phil, trying to make him remember who he is, but Phil prepares to shoot them. Larry tells Ian to run as Phil shoots, mortally wounding Larry even as Larry strangles him. Both die, with Phil's last word being a strangled, "Larry..." Alarms sound as the workers seize their chance for freedom.
In the countryside, Susan and David share a tender moment around a campfire, kissing before the Doctor and Tyler return. The Doctor has deduced the reasons why the Daleks are here — something deep beneath the Earth, tampering with the forces of creation. Ian makes his way deeper into the mine, noticing Jenny and Barbara, who have joined a working party. Jenny is in despair, but Barbara says they must find the control room, as that would be what the Doctor would do. Ian keeps hidden, but tells Wells to pass word to Barbara that he is here. Barbara tells the Daleks that the rebels are planning an attack, and shows them Dortmun's notes. She asks to speak to someone in authority and they agree to take her to the Black Dalek. Meanwhile, the Daleks report to the Black Dalek that they have almost reached the outer crust of the core. All that remains is to set up and the penetration explosive. Once the core is removed, they will replace it with a power system that will allow the Daleks to pilot the planet anywhere in the universe. Unfortunately, Ian has chosen the penetration device as a hiding place, and it is moving into position to be dropped down the main shaft.
Ian disconnects some wires inside the casing, stopping its descent. The Robomen start pulling it back up the shaft, while Ian manages to open a panel at the bottom of the casing and climb out. A Dalek spots him, however, and severs the rope, causing Ian to slide down the shaft and fall against a door, which knocks him out. At that point, Barbara and Jenny are escorted into the Dalek control room. The Black Dalek orders that all humans be moved to the lower galleries to be exterminated in the final blast. The Daleks relay the orders to the Robomen through a microphone, which Barbara notices. The Black Dalek interrogates Barbara and she tries to stall by telling them of an elaborate mutiny that involves Red Indians, the Boston Tea Party, Robert E. Lee and Hannibal, panicking the Daleks momentarily but not enough — she is recaptured when she tries to use the microphone. She and Jenny are immobilised in clamps to await destruction when the bomb explodes.
Outside, the Doctor tells Susan and David to destroy an aerial on the far side of the mine with Dortmun's bombs. He and Tyler will go into the mine itself. Ian regains consciousness outside the lower gallery where the Robomen are hauling timber. When they leave, he puts some of these spars into the bomb shaft, where it stops the progress of the bomb before it can reach the crust. The Daleks are unaware of this, however, and evacuate. The Doctor neutralises the warning system and he and Tyler make their way into the control room, where they free Jenny and Barbara. He explains that David and Susan's mission will immobilise the Daleks. As the Daleks detect the Doctor's presence in the control room, a patrol approaches, but David and Susan succeed and the Daleks stop in their tracks. Barbara and the Doctor use the microphone to tell the Robomen to turn against the Daleks. Human workers and Robomen break into open revolt and stream out of the mine.
Ian is reunited with the others. From where the bomb has stopped, it will not succeed in penetrating the crust but will still produce a gigantic explosion. As they reach higher ground, the bomb explodes, making the ground around the mine collapse and cause an entirely new phenomenon — a volcanic eruption in England. The Dalek saucer is caught in the upward thrust of the explosion. The invasion is over.
Back in London, the resistance helps the Doctor uncover the TARDIS as the chimes of Big Ben herald a new beginning for mankind. Susan is saddened at the prospect of leaving, and the Doctor seems to sense this. He goes into the TARDIS while Susan goes to say good-bye to David, who tells Ian he wants to work the land, see things grow again. Barbara takes Ian back into the TARDIS so they can leave Susan and David alone. David tells Susan that he loves her and asks her to stay and marry him, offering her the place and identity she has been yearning for. Susan admits she loves him too, but she also needs to look after her grandfather, and begs him not to make her choose between them. The Doctor, having heard all this, makes Susan's choice for her. He double-locks the doors of the TARDIS, preventing Susan from entering. He tells her "During all the years I've been taking care of you, you in return have been taking care of me. You are still my grandchild and always will be. But now, you're a woman too. I want you to belong somewhere, to have roots of your own. With David you will be able to find those roots and live normally like any woman should do. Believe me my dear, your future lies with David and not with a silly old buffer like me. One day, I shall come back. Yes, I shall come back. Until then, there must be no regrets, no tears, no anxieties. Just go forward in all your beliefs and prove to me that I am not mistaken in mine. Goodbye Susan. Goodbye my dear." He then makes the TARDIS dematerialise.
Susan looks forlornly around the empty space where the TARDIS used to be, fingering the TARDIS key on the chain around her neck. David reaches his hand out to her and she takes it, dropping the key onto the ground and walking away.