In 1931, during the Great Depression, Michael Sullivan, Sr. is an enforcer for Irish mob boss John Rooney in Rock Island, Illinois. Rooney raised the orphan Sullivan and loves him more than his own biological son, Connor. Rooney holds a wake in his home for the brother of an associate, Finn McGovern. McGovern is clearly agitated and indirectly suggests the Rooney family is responsible. Rooney sends Connor and Sullivan to meet with McGovern, under orders just to talk, but Connor shoots him, resulting in Sullivan gunning down McGovern’s men. Sullivan’s twelve-year-old son Michael Jr. has hidden in his father’s car and witnesses the event. Sullivan swears his son to secrecy and Rooney gets his own personal assurance. Rooney pressures Connor to apologize for his reckless action.
That night, Rooney sends Sullivan to collect a debt from a speakeasy owner, Tony Calvino. Connor, jealous of his father’s preference for Sullivan over him and afraid Michael Jr. might talk, sends a letter with Sullivan for Calvino. When Calvino reads it, he moves to shoot Sullivan, who kills him and his bodyguard first. When Sullivan reads the letter, it says “Kill Sullivan and all your debts are paid”. Fearing his family is in danger, he rushes home. Connor has gone to the Sullivan home and murders Sullivan’s wife, Annie and younger son, Peter. He fails to kill Michael Jr., who received detention at school for fighting and when he returns home, hides from Connor.
Sullivan and Michael Jr. flee Rock Island and head to Chicago in hopes of meeting with Al Capone for work and learning the location of Connor, who has gone into hiding.
In a meeting with Frank Nitti, Sullivan offers to work for the Chicago Outfit in exchange for being allowed to kill Connor. Nitti rejects the offer, and Rooney reluctantly allows him to dispatch assassin Harlen Maguire, a voyeuristic crime scene photographer, to kill Sullivan. Maguire tracks him and his son to a roadside diner, but fails to kill Sullivan. Realizing Maguire’s intentions, Sullivan escapes through the bathroom and punctures Maguire’s car tire before fleeing.
In reaction to the ordered hit, Sullivan begins robbing banks that hold Capone’s money, hoping to trade it for Connor. Sullivan is impeded when the mob withdraws its money, so he visits Rooney’s accountant Alexander Rance at his hotel. The encounter is a set-up, with Rance stalling Sullivan until Maguire enters with a shotgun. In the ensuing crossfire, Rance is killed; Maguire is injured by flying glass shards; and Sullivan escapes with Rooney’s ledgers. As Sullivan flees, Maguire shoots him in his left arm.
When his father collapses from his wound, Michael Jr. drives them to a farm, where a childless elderly couple help him recover. For the first time Sullivan bonds with his son. He discovers from the ledgers that Connor has been embezzling from his father for years, using the names of dead men (including McGovern). As the Sullivans depart the farm, they give the couple much of the stolen money. Sullivan confronts Rooney about his son’s embezzlement while they attend Mass. Rooney, however, already knows and believes that Connor will almost certainly be killed – if not by Sullivan, then by Capone’s men once Rooney is dead. He still refuses to give up his son and urges Sullivan to flee with Michael Jr.
Later one night, cloaked by darkness and rain, Sullivan ambushes and kills Rooney’s bodyguards with a Thompson submachine gun before walking up to Rooney, who accepts his fate and states, “I’m glad it’s you,” as Sullivan shoots him at point-blank range. With no further reason to protect Connor, Nitti reveals his location, after making Sullivan promise to end the feud. Sullivan goes to the hotel where Connor is hiding and kills him in the bathtub.
Sullivan drives his son to stay at his Aunt Sarah’s beach house in Perdition, a town on the shore of Lake Michigan. However, he is ambushed and shot by a disfigured Maguire. As Maguire photographs the dying Sullivan, Michael Jr. appears and points a gun at Maguire but cannot muster the will to fire. Sullivan pulls out his own gun and kills Maguire, showing pride in his son’s inability to fire before dying in his son’s arms. Mourning his father’s death, Michael Jr. returns to live with the elderly farm couple. Growing up, Michael Jr. reflects that his father’s only fear was that his son would become like him. Michael states he has never held a gun since the fatal encounter between Maguire and his father. When asked if Sullivan was a good or bad man, he only replies, “He was my father.”