Clary Frey prepares for a trip to Alicante, the capital city of the Shadowhunters — beings who are part human and part angel. While there, she hopes to find Ragnor Fell, the warlock who holds the key to unlocking the enchantment that is keeping Clary’s mother, Jocelyn, in a coma.
Clary’s newfound brother, Jace, and his adopted family are also going to Alicante. The adults will meet with The Clave, the ruling order of the Shadowhunters, to discuss what they’ve discovered about Valentine’s plan to destroy them. Valentine is Jace and Clary’s biological father, and he has been collecting the Mortal Instruments, relics with magical powers, in order to overthrow the Shadowhunters. He’s succeeded in finding the Mortal Cup and the Mortal Sword, but he still searches for the Mortal Glass.
Jace is desperate to keep Clary out of the Shadowhunter world, afraid of what the Clave will think of her ability to create new runes — symbols with magical powers. He tries to enlist the help of Clary’s best friend, a vampire named Simon, to keep Clary away. Before their plan can be put into action, though, the two are attacked by demons. Jace carries a wounded Simon through a portal to Alicante, even though vampires are not allowed in the Shadowhunter city. A distraught Clary makes her own portal without the others’ knowledge. Her surrogate father, Luke — a werewolf — follows her through.
Luke brings Clary to his estranged sister’s house. After Clary recovers from an accidental poisoning, she sneaks out of the house to find Jace and the Lightwoods. Jace is furious with her and tells her that she is too reckless to be of use to the Shadowhunters. Sebastian, a visitor in the Lightwood home, sees Clary’s distress and offers to take her to Ragnor Fell. When they find the warlock’s house, Clary is surprised to see her friend Magnus Bane posing as Fell. Bane freezes Sebastian and tells Clary that Fell was killed when he wouldn’t tell the location of a powerful spell book. The book is hidden in Valentine’s old home, and Bane convinces Clary to get Jace’s help to find it.
Jace apologizes for speaking harshly to Clary and agrees to help her. While searching his childhood home, they uncover a hidden chamber. The two are shocked to discover a withering angel still held captive within runes Valentine carved years ago. Through visions, the angel shows them how Valentine craved the powers of the Downworlders (vampires, werewolves, warlocks and fairies). He desired their speed, strength and magic.
Valentine secretly fed the blood of a greater demon to Jocelyn while she was pregnant, hoping to create an invincible Shadowhunter. Jocelyn knew something was wrong with the child when it was born and fell into depression. Valentine then captured the angel and used its blood to heal Jocelyn, not knowing she was pregnant with Clary. When Clary creates a new rune to release the angel, the angel kills himself, causing the mansion to disintegrate around them. Once Jace and Clary escape, they seek comfort in each other’s arms. Clary soon realizes that Jace believes he is contaminated with demon blood and is desperately trying to redeem himself by being with Clary. The two argue and head back to Alicante in silence.
Before they get back, they see the city in flames. The magic that protected it from demons has been broken, and an evil horde is attacking the citizens. Jace’s adopted brother, Max, is killed in the fighting. When Clary and Jace help Simon escape from a burning prison, he insists they also help a fellow prisoner. They recognize him as Hodge, Jace’s former tutor, who sacrificed Jace to Valentine in order to secure his freedom. Before Hodge can redeem himself by telling them where the Mortal Glass is hidden, Sebastian kills him. Valentine sends a message that unless the Shadowhunters agree to make him the head of the Clave and kill all Downworlders, he will summon an even greater army of demons to destroy them.
Jace tracks Sebastian to a cave and overhears that Sebastian is Valentine’s true son and the one who is part demon. Jace is another Shadowhunter’s son. Valentine had given angel blood to another Shadowhunter while she was pregnant. Valentine has discovered the Mortal Glass is actually a lake, and he takes the other Mortal Instruments there so he can summon the angel Raziel and fulfill his plan to destroy the Clave. Sebastian and Jace fight. Jace believes he has killed Sebastian and leaves to stop Valentine.
Clary demonstrates her ability to create new runes to the Clave, and they agree to use this power to bind themselves with Downworlders to defeat Valentine. The Downworlders would then be given representation in the Clave, creating a new government. As the others prepare for battle, Clary discovers more of Valentine’s plan and takes a portal to him. He renders her unable to move or speak. Jace arrives, wounded from his battle with Sebastian but ready to fight. Before he can strike the final blow, Valentine runs him through with the Mortal Sword. Jace’s blood is the last ingredient Valentine needs to summon Raziel so Raziel will do his bidding. Clary manages to crawl to the circle of runes Valentine has drawn around an altar. She fights against the magical restraints he has put on her in order to scratch her own runes over them. When Raziel does appear, it is not Valentine who he must obey but Clary. Raziel kills Valentine and tells Clary she can compel him to do one favor. She asks for Jace to be returned from the dead.
With Valentine’s death, the demons attacking Alicante flee. Shadowhunters and Downworlders celebrate with a festival. Luke admits his love for Jocelyn, and she agrees to marry him. Clary and Jace are free to express their love for one another with the knowledge that they are not brother and sister.