Set in the fictional Sovereign City of Nagspeake in 1810, this novel follows two intertwined storylines: a twelve-year-old girl struggling to adapt to life ashore, and two sinister peddlers scheming to abduct her young brother.
Foulk Trigemine, a sutler, or traveling merchant, who works for a powerful figure known as the Great Merchant Morvengarde, arrives in Nagspeake using a device called the kairos mechanism, which allows him to walk through time. He meets Ignis Blister, a peddler and pyrotechnics expert contracted to help with Trigemine's first assignment: finding a conflagrationeer, a rare being born of flame whose abilities with fire exceed ordinary skill. Trigemine's second assignment is to acquire a legendary knife called the Albatross from a weapons-maker known as the Ironmonger. As the two enter the Quayside Harbors district, Blister detects rare chemical compounds in the air, and a firework explodes over a nearby hill, signaling that their quarry is already in town.
Meanwhile, Lucy Bluecrowne arrives unhappily at the family's new house on a hill above the Skidwrack River. She has spent seven of her twelve years aboard her father's privateer schooner, the Left-Handed Fate, and considers the ship her only real home. Captain Richard Bluecrowne has decided to settle the family ashore in neutral Nagspeake, partly because Lucy was nearly killed during a sea battle the year before. Lucy's seven-year-old half-brother Liao, the son of Captain Bluecrowne and his Chinese wife Xiaoming, takes enthusiastically to the new house, especially a stone workshop where he can pursue his passion for pyrotechnics, a skill rooted in his mother's family traditions. Xiaoming, whom Lucy calls Jimǔ, counsels her to consider what might make the place feel homelike, and Liao suggests she get a boat to sail on the river.
At the Quenching Press tavern, Trigemine encounters Christopher Swifte, the Ironmonger, and offers to purchase the Albatross on Morvengarde's behalf; Swifte says he will consider it. The next day, Lucy, Liao, and the family's coxswain Kendrick visit the Harbors, where a locksmith named Jianming Cerrajero directs them to a boatman. Lucy discovers a neglected cutter hidden beneath a pier, feels an instant kinship with the abandoned vessel, and names it the Driven Star after her father purchases it.
Blister confirms Liao as the conflagrationeer after detecting rare Chinese alchemical compounds associated with him. Trigemine reveals that their customer is Jack Hellcoal, a terrifying figure rumored to have bested the Devil himself. Jack possesses a piece of infernal coal and needs a conflagrationeer to kindle the fire required to claim a city as his own domain. Both men realize that failure would bring Jack's retribution down on them personally.
Blister engineers a meeting with the children, demonstrating a flameless blue fire called cald-fire. Inside Blister's wagon, Liao creates a spectacular firework in minutes, confirming his extraordinary abilities. Blister gives Lucy a lamp containing a special wick that secretly allows him to spy on whoever lights its twin, and arranges to visit the Bluecrowne house to teach Liao a formula. Using the spy-lamp, the peddlers observe the household and discover that Xiaoming is not fully human but something akin to an immortal, vastly more powerful than either of them. They suspect Liao inherited his fire abilities from her. Meanwhile, Swifte refuses to sell the Albatross or forge any more weapons. Trigemine performs calculations with the kairos mechanism and determines that the key to the revised plan is Lucy herself.
On the day of Blister's visit, the peddler slips an anti-inflammatory elixir into Liao's drink, then detonates the workshop. Trigemine appears and reveals that Blister has taken Liao. He offers Lucy a bargain: retrieve the Albatross from Swifte and he will return her brother. Lucy sails downriver and attempts to steal the knife from a workshop on Holloware Row, but Swifte catches her inside. Swifte, the workshop's owner Forgeron, and Cerrajero explain that Trigemine will never honor his bargain. Swifte offers Lucy the Albatross freely, but she realizes Trigemine foresaw this and counted on her accepting it. She refuses the knife, declaring she will find another way. Swifte gives her a marlinespike, a tapered steel sailor's tool, and Cerrajero gives her a locksmith's tool for Liao. After Lucy departs, Swifte offers the Albatross to Simon Coffrett, a supernatural traveler known as a Jumper, on the condition that Coffrett rescue Liao. Coffrett declines but assures Swifte that Lucy already has what she needs.
Lucy returns home to find Xiaoming waiting. Her stepmother reveals her true nature: She is a fāngshì, a master of methods, and a celestial being, daughter of the legendary Emperor Shun. She identifies Blister as a practitioner of wàidān, an ancient Chinese alchemical art. Using an oracle bone, Xiaoming performs divination and determines that Lucy's help is essential to the rescue. She burns a talisman into tea for Lucy to drink, explaining that the elixir will allow her to walk through fire, though the ordeal will feel like dying.
Xiaoming and Lucy cross the river to confront the peddlers. Liao is imprisoned in a pillar of lyke-fire, a supernatural blue flame. Xiaoming transforms into a great white crane, deflecting Blister's flames back upon him so that he burns for the first time in his life. She begins to open a doorway in the fire pillar, but Blister leaps onto her back and binds her crane form with a silver cord specially forged to restrain beings like her. Lucy stabs Trigemine with the marlinespike and tears from Liao's collar an engraved stickpin, the device that allows Trigemine to transport others through time, severing his hold on her brother.
Lucy walks through the lyke-fire, enduring agony that the talisman does not eliminate but allows her to survive. Inside the pillar, she discovers she can command the flames. She retrieves the candlestick sustaining the fire and uses the marlinespike to cut the cord binding the crane. The freed bird blinds both peddlers with a flash of light, and Lucy commands the fire to carry her and Liao down the hill to the pier, where she extinguishes the candle.
Blister, though badly burned, casts a final fire called belluine, a blood-red comet that screams through the air. Xiaoming places herself between the comet and her children. The fire strikes her, and her crane form explodes into vermilion sparks. Liao explains that his mother is not dead in a conventional sense but is gone from them, possibly for the span of their lifetimes. Before the fire struck, Xiaoming told them she loved them and urged them to "light the world."
With no wind for sailing and Trigemine in pursuit, Lucy decides to destroy the Driven Star using Liao's powder barrel. Liao rigs a fuse and lights it, and the siblings leap into the river as the cutter explodes. The Left-Handed Fate recovers the children from the water. On the pier, Trigemine and Blister face the consequences of their failure when Jack Hellcoal himself appears, disintegrates Morvengarde's junior partner Seleucia Deacon with a touch of his glowing finger, and orders the surviving pair to make things right.
Without Xiaoming, Captain Bluecrowne cannot leave the children ashore. He tells Lucy and Liao they will ship with him again, fulfilling Lucy's deepest wish under the saddest of circumstances. The siblings return to the house one final time. Liao locks the front door, then slides the key, which bears a fob with the Chinese characters for Bluecrowne that had been intended as a gift for Xiaoming, under the door "so she will have it when she comes home," expressing his quiet faith that his mother will one day return. Together, they walk back down the hill toward the sea.