The prologue talks about hobbits — diminutive men who are peaceful and pastoral in their ways. They have extremely large appetites and primarily live in an area called the Shire in Middle Earth. One of the most famous hobbits is Bilbo Baggins. Many years earlier, he had left the Shire — in the company of Gandalf the Grey, a wizard; Thorin Oakenshield, the king of the dwarves; and a band of Thorin's followers — to find lost treasure. Along the way, Bilbo found a gold ring that once belonged to a creature named Gollum. It could make its wearer turn invisible.
The story begins around 50 years after Bilbo's adventure. Most in the Shire see Bilbo as eccentric but generous. His heir is a young relative named Frodo Baggins, who lives with Bilbo at Bag End.
Bilbo prepares for the celebration for his 111th birthday. Although hobbits often live long lives, Bilbo has physically remained unchanged since his return. He is throwing himself a party — hobbits celebrate their birthdays by giving presents, not receiving them — and plans to secretly leave the Shire, giving Bag End and his remaining wealth to Frodo. At the party, Bilbo gives a farewell speech, slips on the ring and disappears.
Gandalf reminds the hobbit to leave the magic ring behind with Frodo. Although Bilbo is reluctant to part with this precious possession, he eventually does before he leaves. Frodo arrives after Bilbo has left. Gandalf warns the younger hobbit to keep Bilbo's ring hidden.
For the next 17 years, Frodo lives a peaceful life. However, rumors begin to reach the Shire that an ancient evil is reappearing in the dark land of Mordor. Gandalf visits Frodo, who is turning 50. He throws Frodo's ring into the fireplace. While it still glows red with heat, the wizard takes it from the flames; it is cool to the touch. Strange letters appear with the dark language of Mordor on it. The ring was forged by the evil Lord Sauron. It can control 19 lesser rings. Three were made for the Elves, seven for the dwarves and nine for men. Sauron lost the ring during a great battle many centuries earlier. If Sauron can retrieve the ring, he will rule Middle Earth.
Few if any remember the ring's existence, except as legend. Several hundred years earlier, Deagol, of a similar race to hobbits, found the ring in a river. His friend Smeagol killed him for it. After using the ring's power for many years, Smeagol found refuge in the caves of the Misty Mountains, slowly turning into the creature known as Gollum. After Bilbo found the ring, Gollum found his way to Mordor. Through him, Sauron learned that the rings existed in the Shire and of the name Baggins.
Frodo tries to give the ring to Gandalf, but the wizard refuses. Even if he took the ring with good intentions, he knows its power would corrupt him. Frodo realizes the ring must leave the Shire. It can only be destroyed in the volcanic fires of Mount Doom in Mordor. Frodo agrees to carry it until another ring bearer can be found. After Gandalf finds Sam, Frodo's gardener, eavesdropping, Gandalf insists that Sam journey with Frodo.
Frodo spreads the rumor that he will be moving out of Bag End in a few months' time, back to the village of his youth. Gandalf hears news that compels him to leave the Shire. He promises to return by Frodo's birthday party so they can journey together. He warns the hobbit that if he doesn't return, Frodo must leave as planned and take the ring to Rivendell, the ancient home of the elves. Sam and Frodo's other friends (Pippin, Merry and Fatty) help Frodo pack. Only Sam knows Frodo's true destination.
When Frodo's birthday comes without the wizard, he knows he must start the journey without him. Fatty and Merry leave with the last cart of Frodo's belongings. Frodo, Pippin and Sam set out the following day. As they leave, Frodo overhears his neighbor, Sam's father, talking to a stranger. The stranger's voice is frightening, and he asks questions about the name Baggins. Sam's father tells the stranger that Mr. Baggins has moved away from the Shire. The following day, Frodo hears hoof beats on the road behind them and orders his friends to hide. A caped black rider stops where the hobbits had been standing. As the creature sniffs the air in search of them, Frodo fights the overwhelming urge to put on the ring. Before he does, the Black Rider leaves.
The travelers hurry on their way, but again hear hoof beats. They hide in the woods. This time, the Black Rider dismounts. The sound of singing causes the creature to hurry away. The hobbits are relieved to come across a band of elves. Their leader is impressed that Frodo greets them in Elvish. They take the hobbits into their protection for the night and travel to a glade where the elves serve them a feast. Frodo asks about the Black Riders. The elves will only say that they are powerful servants of Sauron and must be avoided.
The next morning, the elves leave the glade before the hobbits wake. Frodo decides they should travel through the woods to their destination, rather than the road. They come across a field belonging to Farmer Maggot. He welcomes them to his home for dinner. He explains that an odd creature was looking for Frodo earlier in the day. After dinner, he hides Frodo, Pippin and Sam in his wagon and takes them to the ferry, the last obstacle until they reach Frodo's new home. As they near the river, they hear hoof beats again. This time, they discover they are Merry's. He set out to look for them when they hadn't arrived earlier in the day. They cross on the ferry, and Merry leads them to Frodo's house and a good meal.
Frodo admits that he has lied to his friends. He is not really going to live in his new home. He is surprised when they explain they'd already figured that out. They had pieced together Frodo's intent by his actions and mumblings over the past year. Sam, Merry and Pippin all insist on traveling to Rivendell with Frodo; only Fatty stays behind.
That night, Frodo dreams of a tall white tower and a blinding flash of light. In the morning, the company sets off toward the town of Bree. Merry leads them to a path inside the old forest, but the hobbits soon become lost. The trees move to block the hobbits' way, diverting them toward a river in the heart of the woods. Suddenly overcome with weariness, all the hobbits except Sam rest under a huge old willow tree.
Sam goes in search of their ponies, which have wandered away. He returns to discover Merry and Pippin are missing and Frodo is in the river. A tree branch holds him there. Sam frees Frodo and discovers Merry and Pippin have been swallowed into the trunk of the tree. Frodo cries for help, and a strange man arrives, singing a song. He introduces himself as Tom Bombadill. He sings a song into the cracks of the tree and it releases Merry and Pippin. Tom offers the hobbits food and rest. The hobbits follow him to a clearing in the forest where Tom's house sits.
They meet Goldberry, Tom's wife, who is a beautiful elf. Frodo asks her who Tom is, and she explains that he is the master of the woods, hills and water. After dinner, the hobbits sleep. All but Sam have nightmares. Frodo sees the white tower again, only this time a man with a staff paces it. A giant eagle swoops down and carries the man away while hoof beats thunder in pursuit. The next day is too rainy for the hobbits to travel, so they gratefully take advantage of Tom's hospitality for another day. He tells them stories of the forest and warns them about the ruins of ancient cities in the hills that are now home to the Barrow-wights, evil spirits. After dinner, Tom asks to see the ring. They are shocked when Tom puts it on his finger but doesn't disappear. When he gives the ring back to Frodo, the hobbit slips it on to be sure it's the right ring. He disappears and sneaks toward the door. Tom looks directly at Frodo and laughs, telling the hobbit to come back to his friends. In the morning, the hobbits set out with new provisions and a rhyme to speak if they are ever in trouble.
The hobbits lose their way and are attacked by the Barrow-wights. At one point, Frodo finds his three friends asleep with a sword across their necks. An arm walks on its fingers toward Frodo. He finds a dagger nearby and cuts the hand from the arm. Frodo sings the rhyme Tom taught them. Tom arrives, destroys the Barrow-wights and frees the hobbits. Then Tom directs them toward Bree where they can find food and rest at the Inn of the Prancing Pony. As they reach it, Frodo asks to be called Mr. Underhill.
Once at the Prancing Pony, Frodo worries about a grizzled-looking man watching them from a dark corner of the room. Butterbar, the bar keeper, explains that the man is called Strider. He's a Ranger from the North. Then Frodo overhears Pippin telling the story of Bilbo's birthday party. To distract them, Frodo jumps on a table and starts singing a rollicking song. Unfortunately, he falls from the table, and the ring slides onto his finger. The patrons are aghast at his disappearance. Frodo reappears in a dark corner. Strider knows Frodo's identity and about the ring.
Strider tries to persuade the hobbits to let him travel with them. They are reluctant to trust him. Butterbar brings Frodo a letter he was supposed to deliver several months earlier. The letter is from Gandalf, who warns them to leave the Shire by the end of July, two months earlier than they did. He tells Frodo to bring the ring to Rivendell and trust a man named Strider, also known as Aragorn. When a Black Rider is spotted in the town, Strider insists they not sleep there, and they follow his advice.
In the morning, they discover that someone had destroyed their previous room and let all the ponies out of the stables. The hobbits must now walk to Rivendell. The Ranger leads the hobbits out of town and off the road, and they spend the next three days being bitten by bugs in the marshes. Once they leave the marshes, they spy Weathertop, a high hill and former stronghold of ancient Men. Runes scrawled on a rock suggest that Gandalf may have come through the area. They make camp for the night. Frodo thinks he sees five Black Riders on the road below, but Strider believes it will be safer to stay on Weathertop rather than risk trying to outrun them on the open plains.
Five Black Riders enter their camp. Pippin and Merry collapse while Sam stays by Frodo's side. Frodo is compelled to put on the ring. He cries out the names of two ancient, powerful elves and stabs at the Rider King's feet. His shoulder and arm suddenly become as ice. Strider leaps between Frodo and the Riders, wielding fire on a branch. The Riders scatter. Frodo removes the ring and becomes visible again.
Later, Strider tells him that the Elvish names Frodo spoke had the power to dispel the Black Riders. Strider is worried when he finds a broken blade on the ground by Frodo. He tells Sam that Frodo's wound is mortal because of the evil inside the blade. If they don't get him to the elves soon, the poison will spread through his body. As the others try to rest, Strider finds a healing plant. It draws out some of the wound's poison, but not enough.
They spend the next few days trying to evade the Black Riders and reach Rivendell. Back on the road, they are frightened by hoof beats, but they are relieved to see an elf on horseback. Glorfindel is an elf-lord and friend of Strider. When they leave the forest, they find five Black Riders waiting to ambush them at the river. Glorfindel, along with Frodo, spurs his horse to cross the river. The Black Riders' horses are reluctant to cross. The Riders enter the river but are washed away by a sudden tidal wave. To Frodo, it looks as if the water has turned into huge, white horses.
Frodo wakes up several days later and is thrilled to see Gandalf waiting by his bedside. Elrond, the leader of the Rivendell elves, barely saved Frodo's life. A shard from the Black Rider's sword had been left in Frodo's shoulder. It was working its way toward his heart. Had it found its mark, Frodo would have been turned into a Black Rider, a wraith. Gandalf tells him that the Black Riders were once the nine men who owned the magic rings. Sauron used his power to subdue them. They were eventually turned into ringwraiths (or nazgul), which are undead servants of the Dark Lord.
The ringwraiths were swept away, but not killed, by the flood. They will eventually return to hunt Frodo and the ring. Frodo is happily surprised to see Bilbo again.
Frodo and Bilbo are asked to attend Elrond's council. Other foreigners include Gloin the dwarf and Legolas, an elf from another kingdom. Boromir, a nobleman from Gondor, tells the council about the recent defeats the men in his kingdom have suffered by warriors from Mordor. He also relates a dream he had in which he was told to look for a sword that was broken, along with something called a Halfling and Isildur's Bane. Strider reveals that he has the sword that was broken. The sword shattered during a battle with Sauron, and Isildur used the sword's handle shard to cut the ring from Sauron's hand. Strider is really Aragorn, a direct descendent of Isildur and, therefore, a King of Middle Earth. Frodo is asked to stand up. Hobbits are known as halflings, and the ring is Isildur's Bane because it led to his death.
After Bilbo and Frodo tell their history with the ring, Gandalf picks up the tale. He spoke of his concerns to the leader of his wizard order, Saruman, Gandalf relates how his fellow wizard, Radagast the Brown, told him that the nine Ringwraiths had been seen roaming the lands again. It was said they searched for the Shire. The wizard then traveled again to Saruman to ask for help, but Sauron had corrupted his master. When Gandalf refused to join them, Saruman locked him in a high tower. Gandalf was rescued with the help of Gwaihir, the king of the giant eagles. The eagle brought him to the kingdom of Rohan where Gandalf tamed a great horse named Shadowfax. He rode the horse to Weathertop where he fought with the Ringwraiths. Escaping their clutches, he hoped to lead a few of them away from Frodo and the others by racing to Rivendell.
The Council has to decide what to do with Frodo's ring. If the One is destroyed, it may break the power of the three rings, and the elves themselves, causing them to fade from history. Elrond says this is a risk the elves are willing to take for the good of Middle Earth. Some in the council think it is folly to try and destroy the ring in the fires of Mount Doom, but Gandalf suggests it is only folly if they have no hope. Bilbo steps forward to volunteer for the journey, thinking that it is his fault the ring has been found, but Gandalf rejects his suggestion. Frodo is then compelled to volunteer. Both Elrond and Gandalf agree that the task seems to have been given to him. Sam jumps out of a corner where he'd been hiding, to demand he be allowed to travel with Frodo.
Two months pass before the rest of the fellowship is chosen to help Frodo carry the ring. The group consists of Frodo, Sam, Aragorn, Boromir, Legolas, Merry, Pippin, Gandalf and Gimli, a dwarf. Bilbo secretly gives Frodo Sting, a dagger that glows blue in the presence of Orcs and goblins, and a coat of mail that Frodo can wear under his clothes. It is made of mithril, a rare metal prized by dwarves. Aragorn has also has his sword reforged and names it Anduril.
The fellowship starts off in the winter. Aragorn and Gandalf argue about how to cross the Misty Mountains. Aragorn wants to travel along the mountain pass, but Gandalf wants to travel under them. Aragorn refuses to consider the idea until they have no other option.
The Mines of Moria, which go under the Misty Mountains, are a legendary place of evil, and only Gimli is anxious to enter them. Gimli and Gandalf find the door, but a spell locks it. While Gandalf tries to discover how to open it, the rest of the group waits by a lake that has unknown things moving within it.
Gandalf solves the door's mystery, and the stone wall opens. As the fellowship moves toward the safety of the mountain, a tentacle slithers out of the lake and grabs Frodo's legs. Sam fights the beast off, but several more tentacles thrust out of the water to take its place. Frodo and the others hurry inside the mines, and Gandalf closes the door. The beast pulls down rocks and trees to block the entrance. The fellowship now has no choice but to continue on through Moria.
Gandalf leads the way with his staff that has a glow to it. When they stop to rest, Pippin throws a stone down a well. Gandalf chastises him, warning him that there are things in the depths of Moria that they do not want to wake. Frodo doesn't mention it, but he is convinced that some creature follows them. After spending the night contemplating which path to choose next, Gandalf guides the party the next morning. He comes to a great room, which turns out to be the hall of records. They find Balin's tomb. Gimli is sad, but also relieved to discover what happened to the famous dwarf.
Gandalf reads a journal of the recent history of the mines. The dwarves were set upon by Orcs. They fought valiantly, but then something else, even more terrifying than Orcs, attacked them. The last passage speaks of being trapped in the hall and hearing drums.
Drums and the sound of running feet approach. Hundreds of Orcs race toward them. The fellowship blocks the door, but a cave troll breaks the door. Frodo stabs it with Sting. The rest of the fellowship fight off the remaining Orcs and flee out another entrance. The Orc King, however, hurls a spear that hits Frodo and thrusts him into a wall. The others are shocked when Frodo sits up, relatively unhurt by the blow.
Gandalf holds the enemy back while Aragorn and Boromir guide the others through the halls. The wizard is exhausted by the amount of energy his spell casting has required. He catches up to the others, and they run toward a narrow bridge spanning a great chasm that leads to the exit. As they cross the bridge, Legolas looks behind him and cries out in terror. A Balrog has appeared from the depths. It is a beast of fire. Gandalf orders the others to run to safety while he fights the creature. Gandalf stands his ground, ordering the Balrog not to pass him. The wizard finally causes the bridge in front of the creature to crumble. As it falls, it casts out a whip of fire that pulls Gandolf into the abyss with it.
The rest of the fellowship flees to the safety of daylight outside the mines. When they finally stop to rest and tend to Frodo's and Sam's wounds, Frodo's mithril shirt is discovered. That evening, the fellowship takes refuge near the woods of Lothlorien, one of the elves' most beautiful kingdoms. A group of elves suddenly appear, and they recognize Legolas as distant kin. They've heard of Frodo and his quest. They allow the fellowship to join them on platforms up in the trees where they can eat and sleep for the night. A party of Orcs pass below them during the night, but do not see them in the trees.
In the morning, the elves demand that Gimli be blindfolded before he enters further into Lothlorien. Gimli is offended, but Aragorn insists that all the fellowship be blindfolded, even Legolas. The elves agree and lead the company into Cerin Amroth, the heart of Lothlorien. Frodo and the others are stunned by the beauty of the elf kingdom.
The company is led up a beautiful tree to meet the Lord Celeborn and Lady Galadriel, rulers of the land. Celeborn welcomes each individual in the language of their own people. He realizes that one of the fellowship is missing, Gandalf. Aragorn tells them how Gandalf fell, defeating the Balrog. Galadriel knows of their journey, and she and Celebron offer their help. The lady then stares into the souls of each of the fellowship, offering them the chance to turn away from the quest and be given the desire of their heart. Later, only Sam admits to what the Lady offered him — the chance to return to the Shire and farm his own plot of land.
The fellowship spends several days in Lothlorien. Galadriel warns Frodo that Sauron is seeking him, but that he will not find him in Lothlorien. Frodo offers her the One Ring. She is tempted, but knows should she accept, she would become as dark and terrible as Sauron.
Celebron gives them boats to travel the length of the river and speed their journey. The fellowship is unsure which way to go next, and Boromir wants to use the ring as a weapon against Sauron. Galadriel gives Aragorn a special sheath for his sword, Sam elven dirt, which will cause any land to bloom, Legolas a new bow, Merry and Pippin new belts and Frodo a vial with the light of Earendil's star. She asks what gift Gimli might like, and he asks shyly for a lock of her hair to remember her.
The fellowship paddle south for many days. Sam, Frodo and Aragorn think Gollum is following them. Aragorn misjudges the distance, and soon they must paddle for their lives or get caught in dangerous rapids. As they fight to reach the shoreline, Orc arrows fly toward them. A dark shape rises into the sky. Legolas jumps to the shore and readies his bow. Frodo's shoulder becomes cold, and he collapses. Legolas manages to shoot the mysterious shape with an arrow, and it falls on the other side of the river. The Orcs do not attack anymore. In the morning, they go toward the ancient ruins of Amon Hen. To reach the site, the boats and baggage must be carried on land until they come to a different tributary of the river. It is a difficult day of hiking before putting the boats back into the water. In the morning, the river's current carries them swiftly downstream. They pass between great stone pillars, carved to look like ancient kings. They pull the boats to the shore. They make camp for the night. Aragorn wakes Frodo during his watch and asks him to draw Sting. The blade grows a faint blue, indicating that Orcs are in the area.
In the morning, Aragorn declares that it is Frodo who must decide where the ring should go. Frodo wanders up the hill of Amon Hen, and Boromir follows. Boromir tries again to convince Frodo to bring the ring to Minas Tirith where it can be used as a weapon against Sauron. When Frodo refuses, Boromir seeks to take it by force. Frodo slips the ring on and disappears. Only then does Boromir become aware of the madness that overtook his mind. He begs Frodo to return, but the hobbit has fled.
On the top of the hill, Frodo has a vision of the war that is to come. He sees the tower of Sauron in the distance and feels the enemy's eye searching for him. It has almost found him when another voice calls him to take off the ring. Frodo must decide his fate. He slips off the ring, and Sauron's eye does not find him. He realizes that he cares too much for the others in the fellowship to ask them to accompany him on his futile quest to destroy the ring. He will take the ring alone to Mordor. He slips it back on and runs through the woods.
Meanwhile, the rest of the fellowship agrees to follow Frodo, no matter what he decides. Sam argues that Frodo will insist on going to Mordor alone. Their job will be to convince him otherwise. Boromir approaches the group and confesses that he followed Frodo into the woods and the hobbit became frightened. The others split up to search for Frodo. Sam realizes that Frodo, wanting to save his friends from a perilous journey, must have returned to the boats to start off alone. He runs back down the hill and sees a boat drifting out into the water. He jumps into the river, nearly drowning. Frodo pulls him into the boat, chastising him for following. Sam insists that he would rather die on the journey with Frodo then be left behind. The two hobbits set off toward Mordor.