Manor Farm is a small farm in England run by the harsh and often drunk Mr. Jones. One night, a boar named Old Major gathers all the animals of Manor Farm together. Knowing that he will soon die, Old Major gives a speech in which he reveals to the animals that men cause all the misery that animals endure. Old Major says that all animals are equal and urges them to join together to rebel. He teaches them a revolutionary song called "Beasts of England." Old Major dies soon after, but two pigs named Snowball and Napoleon adapt his ideas into the philosophy of Animalism. Three months later, the animals defeat Jones in an unplanned uprising. The farm is renamed "Animal Farm."
The ingenuity of the pigs, the immense strength of a horse named Boxer, and the absence of parasitical humans makes Animal Farm prosperous. The animals post the Seven Commandments of Animalism on the side of the barn. The commandments state that all animals are equal and no animal may act like a human by sleeping in a bed, walking on two legs, killing other animals, drinking alcohol, and so on.
A fight for power soon develops between the two pigs Snowball and Napoleon. The rivalry comes to a head over Snowball's idea to build a windmill. At the final debate about the windmill, Napoleon summons dogs he has secretly reared to be his own vicious servants and has them chase Snowball from Animal Farm. Napoleon tells the other animals that Snowball was a "bad influence," eliminates the animals' right to vote, and takes "the burden" of leadership on himself. He sends around a pig named Squealer, who persuades the animals that Napoleon has their best interests at heart.
Three weeks later Napoleon decides they should build the windmill after all. The animals set to work, with Boxer leading. Focusing on the windmill reduces the productivity of the farm, and all the animals but the pigs get less to eat. The pigs begin to trade with other farms, move into Mr. Jones's farmhouse, and start to sleep in beds. This confuses the animals who considered this forbidden behavior. But when they check the Commandment about beds, it reads: "No animal shall sleep in a bed with sheets."
Over the next few years, Animal Farm battles with its human neighbors. The windmill gets destroyed first by a storm and then by a human attack. Napoleon blames all catastrophes on the "traitor" Snowball, and uses fear tactics, information control, and deadly purges of anyone he considers an enemy to strengthen his power over the farm. Meanwhile, the pigs secretly continue to rewrite the Commandments and all of Animal Farm's history to support their lies. They give the animals less food and demand more work, while eating more and working less themselves. The other animals, duped by the pigs' misinformation, continue to consider themselves part of a great revolution. When Boxer, the most devoted worker on the farm, is no longer able to work, the pigs sell him to a glue factory and use the proceeds to buy whiskey.
Years pass. Now only a few of the remaining animals on the farm experienced the revolution. Even fewer remember its goals. The pigs teach themselves to walk on two legs and begin carrying whips. When the animals look at the Seven Commandments, they have been replaced by the statement: "All animals are equal. But some animals are more equal than others." The pigs make peace with their human neighbors and have a feast. The other animals are shocked to discover that they can no longer tell the pigs from the humans.