Vanity Fair is the story of Becky Sharp, a clever and ambitious young woman, and her friend Amelia Sedley who is more pliable and likable. The two women go through their lives in the climate of England during the Napoleonic Wars, enduring difficult marriages, relationships, the perils of motherhood, and the trials of womanhood during the oppressive period. The novel presents the passive Amelia as an admirable figure while the acid-tongued and manipulative Becky is derided.
The story is framed by its preface and coda as a puppet show taking place at a fair; the cover illustration of the serial installments was not of the characters but of a troupe of comic actors at Speakers' Corner in Hyde Park. The narrator, variously a show manager or writer, appears at times within the work itself and is highly unreliable, repeating a tale of gossip at second or third hand.
Rebecca Sharp ("Becky") is a strong-willed, cunning, moneyless, young woman determined to make her way in society. After leaving school, Becky stays with Amelia Sedley ("Emmy"), who is a good-natured, simple-minded young girl, of a wealthy London family. There, Becky meets the dashing and self-obsessed Captain George Osborne (Amelia's betrothed) and Amelia's brother Joseph ("Jos") Sedley, a clumsy and vainglorious but rich civil servant home from the East India Company. Hoping to marry Sedley, the richest young man she has met, Becky entices him, but she fails. George Osborne's friend Captain William Dobbin loves Amelia, but only wishes her happiness, which is centred on George.
Becky Sharp says farewell to the Sedley family and enters the service of the crude and profligate baronet Sir Pitt Crawley, who has engaged her as a governess to his daughters. Her behaviour at Sir Pitt's house gains his favour, and after the premature death of his second wife, he proposes marriage to her. However he finds that she has secretly married his second son, Captain Rawdon Crawley. (Becky very much regrets having done that; however, when she married Rawdon she had no idea that his father's wife would die so soon after). Sir Pitt's elder half sister, the spinster Miss Crawley, is very rich, having inherited her mother's fortune, and the whole Crawley family compete for her favour so she will bequeath them her wealth. Initially her favourite is Rawdon Crawley. But his marriage with Becky enrages her. First she favours the family of Sir Pitt's brother, but when she dies, she has left her money to Sir Pitt's oldest son, also called Pitt.
Amelia's father, John Sedley, becomes bankrupt. George's rich father forbids George to marry Amelia, who is now poor. Dobbin persuades George to marry Amelia, and George is consequently disinherited. News arrives that Napoleon has escaped from Elba, so George Osborne, William Dobbin and Rawdon Crawley are deployed to Brussels, accompanied by Amelia and Becky, and Amelia's brother, Jos. George is embarrassed by the vulgarity of Mrs. Major O'Dowd, the wife of the head of the regiment. Already, the newly wedded Osborne is growing tired of Amelia, and he becomes increasingly attracted to Becky, which makes Amelia jealous and unhappy. He is also losing money to Rawdon at cards and billiards. At a ball in Brussels, George gives Becky a note inviting her to run away with him. But then the army have marching orders to the Battle of Waterloo, and George spends a tender night with Amelia and leaves. The noise of battle horrifies Amelia, and she is comforted by the brisk but kind Mrs. O'Dowd. Becky is indifferent and makes plans for whatever the outcome (if Napoleon wins, she would aim to become the mistress of one of his Marshals...). She also makes a profit selling her carriage and horses at inflated prices to Jos, seeking to flee Brussels.
George Osborne is killed at Quatre Bras, while Dobbin and Rawdon survive Waterloo. Amelia bears a posthumous son, who carries on the name George. She returns to live in genteel poverty with her parents, spending her life in memory of her husband and care of her son. Dobbin pays for a small annuity for Amelia and expresses his love for her by small kindnesses toward her and her son. She is too much in love with her husband's memory to return Dobbin's love. Saddened, he goes with his regiment to India for many years.
Becky also has a son, named Rawdon after his father. Becky is a cold, distant mother, although Rawdon loves his son. Becky continues her ascent first in post-war Paris and then in London where she is patronised by the rich and powerful Marquis of Steyne. She is eventually presented at court to the Prince Regent and charms him further at a game of "acting charades" where she plays the roles of Clytemnestra and Philomela. The elderly Sir Pitt Crawley dies and is succeeded by his son Pitt, who had married Lady Jane Sheepshanks, Lord Southdown's third daughter. Becky is on good terms with Pitt and Jane originally, but Jane is disgusted by Becky's attitude to her son and jealous of Becky's relationship with Pitt.
At the summit of their social success, Rawdon is arrested for debt, possibly at Becky's connivance. The financial success of the Crawleys had been a topic of gossip; in fact they were living on credit even when it ruined those who trusted them, such as their landlord, an old servant of the Crawley family. The Marquis of Steyne had given Becky money, jewels, and other gifts but Becky does not use them for expenses or to free her husband. Instead, Rawdon's letter to his brother is received by Lady Jane, who pays the£170 that prompted his imprisonment. He returns home to find Becky singing to Steyne and strikes him down on the assumption—despite her protestations of innocence—that they are having an affair. Steyne is indignant, having assumed the £1000 he had just given Becky was part of an arrangement with her husband. Rawdon finds Becky's hidden bank records and leaves her, expecting Steyne to challenge him to a duel. Instead Steyne arranges for Rawdon to be made Governor of Coventry Island, a pest-ridden location. Becky, having lost both husband and credibility, leaves England and wanders the continent, leaving her son in the care of Pitt and Lady Jane.
As Amelia's adored son George grows up, his grandfather Mr Osborne relents towards him (though not towards Amelia) and takes him from his impoverished mother, who knows the rich old man will give him a better start in life than she could manage. After twelve years abroad, both Joseph Sedley and Dobbin return. Dobbin professes his unchanged love to Amelia. Amelia is affectionate, but she cannot forget the memory of her dead husband. Dobbin mediates a reconciliation between Amelia and her father-in-law, who dies soon after. He had amended his will, bequeathing young George half his large fortune and Amelia a generous annuity.
After the death of Mr Osborne, Amelia, Jos, George and Dobbin go to Pumpernickel (Weimar in Germany), where they encounter the destitute Becky. Becky has fallen in life. She lives among card sharps and con artists, drinking heavily and gambling. Becky enchants Jos Sedley all over again, and Amelia is persuaded to let Becky join them. Dobbin forbids this, and reminds Amelia of her jealousy of Becky with her husband. Amelia feels that this dishonours the memory of her dead and revered husband, and this leads to a complete breach between her and Dobbin. Dobbin leaves the group and rejoins his regiment, while Becky remains with the group.
However, Becky has decided that Amelia should marry Dobbin, even though she knows Dobbin is her enemy. Becky shows Amelia George's note, kept all this time from the eve of the Battle of Waterloo, and Amelia finally realises that George was not the perfect man she always thought, and that she has rejected a better man, Dobbin. Amelia and Dobbin are reconciled and return to England. Becky and Jos stay in Europe. Jos dies, possibly suspiciously, after signing a portion of his money to Becky as life insurance, setting her up with an income. She returns to England, and manages a respectable life, although all her previous friends refuse to acknowledge her.