For centuries, India was ruled by the British Empire. But India bargained for its independence from Britain by agreeing to help it fight the Axis Powers in World War II. After the war was over, the British left in 1947 and divided the country into two, secular/Hindu India and Muslim Pakistan. However, despite the fact that many Muslims lived in India and many Hindus lived in Pakistan, most Hindus lived in India and Muslims in Pakistan.

When the British withdrew, then, those who were not in the "right place" had to flee to a new country. In the summer of 1947, ten million people crossed what was known as "the partition." Due to religious and ethnic hatred, two million people were killed during the skirmishes and mob violence that occurred in the chaos. Local authorities were just taking over from the British and had no ability to control the populace.

Train to Pakistan takes place in the fictional town of Mano Majra, which was near the partition. Many border towns like Mano Majra contained great religious diversity, with Hindus, Muslims and Sikhs living side by side. But the British took no account of these towns, and so great violence erupted within them. In contrast, the author shows Mano Majra as maintaining its order, given its relative isolation. However, Mano Majra possessed a train station that would eventually make it a center of conflict.

The story begins with the robbery and murder of Lala Ram Lal, the only Hindu family in town. The murderers were a gang led by Malli, who were looking for their old fellow gang member and leader Juggut Singh, a Sikh hoodlum of great height, build and with a bad reputation. During the event of "dacoit", however, "Jugga" was making love with his girlfriend, Nooran, the daughter of the town's Mullah (the interreligious love was strictly forbidden). At the same time of the dacoit, Iqbal Singh, a well-educated, effeminate atheist, though ethnic Sikh, arrived in town to organize the peasants for the People's Party of India.

Malli and his gang try to pin the crime on Jugga, which results in the arrests of both Iqbal and Jugga due to local suspicions. They are arrested due to the orders of Hukum Chand, the regional magistrate, in part because of his suspicions of both characters for independent reasons. While they are in prison, however, conflict starts to rise in Mano Majra when a train full of Muslim corpses is brought to town and burned by soldiers. Not long after, a group of soldiers comes by to evacuate the Muslim half of town (the other half is Sikh) to Pakistan which leads Nooran to depart while Jugga is in jail in the regional capital of Chundunnugger.

After the Muslims are evacuated, a local band of Sikhs comes to Mano Majra to whip up anti-Muslim sentiment and sabotage the train that was taking the Muslims to Pakistan. Chand, normally corrupted but racked with guilt over his own sins, releases both Iqbal and Jugga to stop the killing, and despite Iqbal's self-image as a social reformer and Jugga's self-image as a thug, Iqbal drinks himself into a stupor while Jugga gives his life destroying the rope the Sikh soldiers had set up to throw Muslims on top of the train off to their deaths.