Teenager Zach Cooper and his mother Gale move from New York to the small fictional town of Madison, Delaware. Their new neighbors are the mysterious "Mr. Shivers" and his daughter Hannah, but when Zach tries to introduce himself, Mr. Shivers warns him to stay away from them. At his new high school, Zach meets and befriends Champ, a socially awkward student who is often bullied. One night, Zach hears Mr. Shivers and Hannah arguing from his window, followed by Hannah screaming. He calls the police, but Mr. Shivers assures the officers that nothing is wrong and the scream was from a movie.
Fearing Hannah is in danger, Zach anonymously calls Mr. Shivers, pretending to be a police officer, and tells him to come to the police station for further questioning. Once he is gone, Zach and Champ break into the house in search of Hannah. They find several manuscripts from the Goosebumps book series, all of which are locked. They unlock The Abominable Snowman of Pasadena, but are confronted by Hannah, who assumes they are burgling the house. Zach clears up the misunderstanding, but when he opens the unlocked book, a Yeti emerges from it and breaks out of the house. In the ensuing chaos, the Night of the Living Dummy manuscript is accidentally unlocked as well. Zach, Champ, and Hannah pursue the Yeti to a local ice rink and it attacks them, but Mr. Shivers appears and sucks it back into the book.
On the way home, Mr. Shivers explains that he is actually R.L. Stine, the author of Goosebumps. He created the Goosebumpsmonsters when he was a child to cope with severe bullying. However, the monsters came to life and became uncontrollable, so he had to trap them inside their manuscripts. Returning to the house, Stine and the kids are confronted by Slappy the Dummy, the villain of Night of the Living Dummy, who is angry about being imprisoned. Before Stine can capture him, Slappy burns his own manuscript and flees with the others. The gnomes from Revenge of the Lawn Gnomes are also freed and Stine and the kids try to fend them off, but each gnome reforms after being smashed, making them realize that the monsters cannot be destroyed.
Slappy releases the Goosebumps monsters and leads them on a destructive rampage across Madison. Zach suggests that Stine write a new book that will trap every monster, but he can only do it on a special typewriter which is at the high school. The monsters attack Stine and the kids on the way to the school, and the Werewolf of Fever Swamp pursues them into an abandoned supermarket, only to be run over by Zach's aunt Lorraine. As they continue toward the school, Zach notices that Hannah glows blue in the moonlight. He privately questions Stine about this and Stine reveals that Hannah is a Goosebumps character he created after his wife died, but she is unaware of this. At the school, they find the typewriter and starts work on the new book. As the monsters storm the school, Zach leads the other students in barricading the doors, while Champ saves popular girl Taylor from the werewolf. Slappy confronts Stine and breaks his fingers with the typewriter case before the story is finished.
Stine and the kids board a school bus and lead the monsters to an abandoned carnival on the outskirts of town. While Stine distracts the monsters, Zach finishes the story, but is reluctant to open the book because Hannah will be trapped inside it as well. Hannah reveals that she knew she was not real all along and opens the book, sucking all of the monsters into it. While Zach tries to hold on to her, Hannah accepts her fate and is imprisoned as well after they kiss.
Sometime later, Stine has started working at the high school as an English teacher. After class, Zach asks him if he misses Hannah, but Hannah suddenly reappears. Stine reveals that he wrote her back into existence with another book. She and Zach kiss and leave school together while Stine burns Hannah's manuscript. As he prepares to leave the school, he sees the typewriter typing by itself inside it's display cabinet, and the paper reads "The Invisible Boy's Revenge". Brent Green, the invisible boy from My Best Friend Is Invisible, has somehow evaded capture and Stine screams as Brent's hand prints appear on the cabinet's glass.
