Harry Potter is a seemingly ordinary boy, living with his hostile relatives, the Dursleys in Surrey. On his eleventh birthday, Harry learns from a mysterious stranger, Rubeus Hagrid, that he is actually a wizard, famous in the Wizarding World for surviving an attack by the evil Lord Voldemort when Harry was only a baby. Voldemort killed Harry's parents, but his attack on Harry rebounded, leaving only a lightning-bolt scar on Harry's forehead and rendering Voldemort powerless. Hagrid reveals to Harry that he has been invited to attend Hogwarts School of Witchcraft and Wizardry. After buying his school supplies from the hidden wizarding street, Diagon Alley, Harry boards the train to Hogwarts via the concealed Platform 9¾ in King's Cross Station.
On the train, Harry meets Ron Weasley, a boy from a large, but poor, pure-blood wizarding family, and Hermione Granger, a witch born to non-magical parents. Once they arrive at the school, Harry and all of the other first-year students are sorted into four different houses: Gryffindor, Hufflepuff, Ravenclaw, and Slytherin. As Slytherin is noted for being the house of darker wizards and witches, Harry successfully begs the magical Sorting Hat not to put him in Slytherin. He winds up in Gryffindor, along with Ron and Hermione.
At Hogwarts, Harry begins learning wizardry and also discovers more about his past and his parents. Harry inadvertently makes Gryffindor's Quidditch team (a sport in the wizarding world where people fly on broomsticks) as a Seeker, learning that his father was also a member of the team.
One night, he, Ron, and Hermione find a giant three-headed dog on a restricted floor at the school. The trio successfully take down an escaped mountain troll and after Harry is nearly knocked off his broom by a powerful curse during one of the Quidditch matches, the trio assume that someone is trying to get past the dog. Harry discovers the Mirror of Erised which shows a person's heart's desire. The headmaster Albus Dumbledore moves the mirror and advises Harry against looking for it. Using information accidentally let slip by Hagrid, Hermione discovers that the dog is guarding the Philosopher's Stone, an item that can be used to grant its owner immortality. Harry concludes that his potions teacher, Severus Snape, is trying to obtain the stone. Harry is caught out of bed at night and is given detention. While helping Hagrid in the dark forest Harry sees a hooded figure drinking a unicorn's blood for its healing properties. Harry concludes that the hooded figure was Voldemort and that Snape is trying to get the stone to restore Voldemort to full strength.
After hearing from Hagrid that the dog will fall asleep if played music and that he let slip this to a man in the local pub one night, Harry, Ron, and Hermione decide that Snape was the man in the pub and attempt to warn Dumbledore. Upon learning he is away on business the trio conclude that Snape will attempt to steal the stone that night and resolve to find the stone before Snape does.
They face a series of obstacles: surviving a deadly plant, flying past hundreds of flying keys and winning a violent, life-sized chess match. The trio use their skills to overcome the obstacles. Hermione uses her knowledge of spells to get past the plant, Harry uses his skills as a seeker to get past the keys and Ron uses his skill at chess to win the chess match. However, Ron is nearly killed in the match and Hermione stays with Ron as Harry goes on ahead, alone.
In the final room, Harry finds out that it was not Snape who wanted the stone, but Defense Against the Dark Arts teacher Professor Quirrell. Quirrell reveals that he let the troll in and tried to kill Harry in the Quidditch match. He also reveals that Snape has been protecting Harry and trying to stop Quirrell all year. Due to an enchantment placed by Dumbledore, Harry finds the stone in his pocket after looking in the nearby Mirror of Erised. Quirrell removes his turban and reveals Voldemort to be living on the back of his head. Harry tries to escape but Quirrell starts a fire by clicking his fingers to trap Harry. Voldemort tries to convince Harry to give him the stone by promising to bring his parents back from the dead, but Harry refuses. Quirrell tries to kill him but Harry's touch prevents Quirrell from hurting Harry and causes his hand to turn to dust. Quirrell then tries to take the stone but Harry grabs his face, causing Quirrell to turn into dust and die. When Harry gets up, Voldemort's spirit forms and passes through Harry, knocking him unconscious, before fleeing.
Harry wakes up in the school's hospital wing, with Professor Dumbledore at his side. Dumbledore explains that the stone has been destroyed, and that both Hermione and Ron are fine. Quirrell burned at Harry's touch because, when Harry's mother died to save him, her death gave Harry a magical, love-based protection against Voldemort. At the end of year feast, Dumbledore gives last minute house points to Harry, Ron, Neville and Hermione for their bravery and smarts so Gryffindor win the house cup. Before Harry and the rest of the students leave for the summer, Harry realises that while every other student is going home, Hogwarts is truly his home.