Christopher Pike's "Chain Letter" is a thriller that begins when a group of friends receives a menacing chain letter threatening to reveal their one sinful night to the world. The sinful night is recounted in detail in Chapter 3, where we learn that the seven teens accidentally run over a man in a drunken car accident and then buried him in a shallow grave by the side of the road. His death was never discovered or reported.

Forced to choose between exposing themselves as unthinking criminals and following the embarrassing demands of the letter's author, who calls himself the Caretaker, the group of seven chooses to obey. Those who choose not to obey must suffer the horrifying consequences, and when the second round of the chain letter's demands begin, the friends know their commands and corresponding punishments are not child's play. The group is riddled with paranoia as they begin to suspect each other and it becomes apparent that the Caretaker is intimately familiar with their personalities and conversations.

As the friends begin to disappear and one among the seven, Neil, is killed, the race is on for the remaining teens to figure out who is sending the letters and what is motivating him or her. The final two chapters suddenly reveal the situation to be much stranger than any of the teens could have imagined. As it turns out, Neil has faked his death using the corpse of the man they ran over as a dummy for himself, and he has been the Caretaker all along. Terminally ill with cancer, Neil has come to identify closely with the man he and his friends killed, and has been burdened with guilt to the point of insanity. His hasty burial weighs on Neil's conscience, and his strange machinations are a way of making his friends feel similarly guilty. Neil is about to take the five friends he has trapped in an abandoned house to the man's gravesite in order to kill them when a final confrontation with his best friend, Tony, restores his sanity and leads him to release his friends before dying one week later from his terminal cancer.

The dramatic events surrounding the chain letter form the core of the novel, but we also follow the budding romance between Tony and Alison, and this romance provides some of the tension that lays behind Neil's vindictive actions. Because Neil had a crush on Alison, Tony's pursuit of Alison is interpreted as a betrayal, and it is only Tony's ministrations to Neil at the end of his life that prove to him that Tony is a genuine friend. The book closes with Tony and Alison embracing the day after Neil's death.