Emma Woodhouse is the beautiful and wealthy mistress of Hartfield, the most notable house in Highbury, Essex. She lives a lonely and dull existence with her hypochondriac father. Miss Taylor, her governess, has recently married Mr Weston, isolating Emma further. Mr Knightley is chief among the Woodhouses' acquaintance. He has known Emma all her life and is the older brother of her brother-in-law. He owns most of Highbury and the parish of Donwell, living in Donwell Abbey. He is the only one who is critical of Emma's behaviour.
Emma makes friends with Harriet Smith, an illegitimate girl living at Mrs Goddard's school. Harriet is attracted to Robert Smith, a local farmer and friend of Mr Knightley, but Emma feels this match is unworthy and resolves to pair her friend with Mr Elton, the Vicar of Highbury. However, her strategies backfire when Mr Elton proposes to her, and not Harriet. She proclaims she will give up matchmaking, but soon changes her mind when the son of Mr Weston, Frank Churchill, arrives. He was adopted by his snobbish aunt and uncle on the death of his mother, and despite the secret wish of the Westons for him and Emma to be united, Emma decides to plan his marriage to Harriet. Only Mr Knightley dislikes him.
Jane Fairfax arrives in Highbury to stay with her grandmother, Mrs Bates. She is an orphan who has been living with the wealthy Campbell family as a companion for the young Miss Campbell. The marriage of her friend means Jane must now find employment as a governess. Emma dislikes this elegant and accomplished young woman. Soon after her arrival, the district learns of Mr Elton's engagement to a Miss Hawkins whom he met in Bath.
Frank Churchill encourages Emma to speculate about a possible liaison between Jane and Mr Dixon, the husband of the former Miss Campbell. The anonymous gift of a piano to Jane compounds the rumour. Mrs Weston, on the other hand, believes that Mr Knightley is falling in love with Jane. Frank Churchill is called away to Yorkshire while in the midst of helping arrange a ball. Emma is convinced he was about to declare his love for her. Soon after Mr and Mrs Elton arrive, prompting a number of social events. Mrs Elton decides to patronize Jane Fairfax.
When Frank's return is announced, the plans for the ball are begun once more. Mr Elton snubs Harriet, but Mr Knightley dances with her and then Emma. When Frank rescues Harriet from gypsies the next day, Emma believes he is ready to fall in love with her friend. A trip to Box Hill frays tempers, and Mr Knightley reprimands Emma after being rude to Miss Bates. When apologizing soon after she learns that Jane has decided to take up a post as governess.
Mrs Churchill's sudden death precipitates the astonishing news that Jane and Frank were all along secretly engaged - he apparently courted Emma to hide this. Emma attempts to comfort Harriet once more, but when she does so she is shocked to learn that her friend has no interest in Frank and is in love with Mr Knightley. Emma realizes that in fact she has been in love with her friend all this time. Mr Knightley comes to comfort Emma, believing her to be grieving for Frank, but when she tells otherwise, he professes his love for her and proposes. Harriet's disappointment is alleviated somewhat by a trip to London. While there, she meets with Robert Martin and immediately accepts his proposal of marriage. The novel ends with three marriages.