Two men, Gibreel Farishta and Saladin Chamcha, fall through the sky following the explosion of Flight 420. Both men are actors: Gibreel is a movie star in India known for portraying gods, while Saladin is a television star in England known for his controversial depictions of immigrants. Their flight was destroyed after a group of terrorists highjacked it and detonated explosives. Even though everyone else on the flight dies, Gibreel and Saladin manage to survive, seemingly through divine intervention. Upon washing up on a beach in England, the men begin to undergo different but equally strange transformations. Gibreel’s transformation is purely mental. He begins having dreams in which he is the archangel Gibreel delivering messages to important figures in the Islamic tradition. The most significant of these visions sees Gibreel delivering the “satanic verses” to Mahound (Rushdie’s fictional equivalent of the Prophet Mohammad). These satanic verses cause both Mahound and Gibreel to question whether Gibreel is acting as a mouthpiece of God or Shaitan (Satan). Ultimately, Mahound dismisses the satanic verses, thinking them the work of the devil.
Meanwhile, Saladin undergoes a grotesque physical transformation, becoming a devil-like figure with horns and goat’s hooves. Saladin’s transformation gets underway just as the police take him into custody, believing he is an illegal immigrant. Too distracted by his own problems to care, Gibreel allows the police to take Saladin without saying a word. The police brutally mock and beat Saladin, humiliating him. Eventually, they realize he is a British citizen and abandon him.
Saladin wakes up in a hospital where he sees other people like him who are turning into a variety of mythological creatures. One of the creatures informs him that his transformation is a result of how others—particularly the English, who are hostile toward immigrants—see him. Saladin breaks out of the hospital with these other creatures and then attempts to get his life back in order.
However, Saladin quickly discovers that his wife, Pamela, has begun seeing his childhood friend, Jumpy, because both thought he died in Flight 420. Because he cannot return to Pamela, Saladin lives with the Sufyans who run a café and boarding house. Mr. Sufyan is happy to care for Saladin despite his transformation. However, his wife, Hind Sufyan, wants Saladin to go away because she thinks he is a corrupting influence.
Meanwhile, Gibreel resumes his relationship with a woman named Alleluia (Allie) Cone. Alleluia is an accomplished English mountaineer, who has reached the summit of Mount Everest. Allie is surprised that Gibreel is alive and is eager to rekindle her relationship with him, although her mother, Alicja, disapproves. Although Allie and Gibreel’s relationship goes well at first, it starts to deteriorate when Gibreel becomes jealous of other men’s attraction to Allie. Gibreel’s jealousy drives them to fight and temporarily split up. During this time, Gibreel also has another vision relating to Mahound. In this vision, Mahound has become a tyrant in Jahilia (the novel’s stand-in for Mecca). The only one willing to stand up to Mahound in a poet, Baal, who makes it his life’s mission to satirize and mock Mahound. Mahound ultimately puts Baal to death for what he writes.
Back at the Sufyan household, Saladin completes his grotesque transformation, which is too much for Hind Sufyan to stomach. Saladin leaves and ends up at an empty club where he reaches his physical and spiritual low point. After a great internal struggle, Saladin decides that he will take back control of his life, at which point he transforms back into a man. Then, he goes back to Pamela and tells her that he intends to live with her and Jumpy for the time being. Around this time, Saladin also learns about Dr. Uhuru Simba, a local Black activist who is being framed for the “Granny Ripper” murders that are plaguing London.
Gibreel returns to London, where his visions become increasingly extreme. He often has a difficult time distinguishing between fantasy and reality. In London, Gibreel sees Saladin at a party. Although Gibreel does not know it, Saladin still hates him because Gibreel abandoned him when the police came for him. All Gibreel can talk about is his relationship with Allie, which drives Saladin mad. In an angry outburst, he reveals that Pamela and Jumpy are going to have a child together. After hearing this news, Gibreel assaults Jumpy and runs away.
Because Allie thinks Saladin is a friend, she asks him if he will help her take care of Gibreel, whose actions are becoming increasingly erratic. Saladin agrees to do so, but instead of fulfilling his promise, he deliberately drives a wedge between Allie and Gibreel as a form of revenge. Saladin’s meddling ultimately leads to the destruction of Allie and Gibreel’s relationship.
Just after this, the public discovers that Dr. Uhuru Simba died under mysterious circumstances while in police custody. Many minorities in England believe that the police murdered Simba, thinking his death was racially and politically motivated. This leads to a great deal of civil unrest.
During this period of unrest, Gibreel succumbs to his madness. In a state of full delusion, Gibreel walks into a music store and purchases a trumpet, which he names Azraeel. Then, he walks out into the streets to issue divine judgment. While wandering around London, he discovers that Saladin is in danger and rushes into a fire to save him. Gibreel exits a burning building carrying Saladin in his arms.
Eighteen months later, Saladin flies to India because his father, Changez, is ill and about to die. For much of his life, Saladin has run away from India and his Indian identity. However, at this point, he begins to reembrace it. Saladin makes up with Changez, with whom he has long had a contentious relationship, on his deathbed. After Changez dies, Saladin decides to stay in India and rekindle a relationship with Zeeny Vakil, a leftist writer with whom he once had an affair. During this period, Gibreel also returns to India, but his life goes downhill fast. He loses what is left of his career and fortune, which only increases his sense of rage.
Then, one day, Allie comes to visit him in India to try to repair their relationship. This visit ends in a physical fight where Gibreel throws Allie off the roof of his building, killing her. Panicked, Gibreel runs away from the scene and the crime and travels to Saladin’s apartment. After confessing what he did to Saladin, Gibreel shoots himself in the head before the police can capture him.