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The novel describes the downfall of Ferdinando Falkland, a British squire, and his attempts to ruin and destroy the life of Caleb Williams, a poor but ambitious young man that Falkland hires as his personal secretary. Caleb accidentally discovers a terrible secret in his master's past. Though Caleb promises to be bound to silence, Falkland, irrationally attached (in Godwin's view) to ideas of social status and inborn virtue, cannot bear that his servant should possibly have power over him, and sets out to use various means--unfair trials, imprisonment, pursuit, to make sure that the information of which Caleb is the bearer will never be revealed.
Godwin described the book as "a series of adventures of flight and pursuit; the fugitive in perpetual apprehension of being overwhelmed with the worst calamities", so that Caleb Williams can be classified as an early thriller or mystery novel.