Captain John Yossarian, a World War II bombardier, is stationed on the island of Pianosa. He is an individualist who seeks to protect his own life by fleeing to the hospital, since a “catch-22” in the Air Force regulations prevents him from being grounded for illness or obtaining a leave. He enjoys living in the ward, where all his meals are served to him. In turn, he simply needs to feign pain in his liver and censor the letters of enlisted men. Bored by his job, Yossarian takes on the pseudonym “Washington Irving” and pretends to be Chaplain Tappman. Alarmed by these strange occurrences, the government sends two C.I.D. men to investigate. Other men also seek the haven of the hospital by feigning illness, but after the mysterious death of the soldier in white, the Texan forces them to return to the front.
On the front, the other men are equally as crazy as Yossarian. His roommate, Orr, crash-lands every time he goes on a mission and talks about putting apples and horse chestnuts in his cheeks. Clevinger, a Harvard graduate, argues with Yossarian about whether or not people must obey their institutions and fight the war. Havermeyer munches on peanut butter brittle all the time, loves to shoot innocent field mice with his pistol, and earns the wrath of his men by never taking evasive action on a mission. Doc Daneeka, the squadron's doctor, is a hypochondriac who belittles everyone else's illnesses rather than treating them. Chief White Halfoat constantly gets drunk and brags about his displacement by “Americans” who strike oil wherever he and his family go. McWatt, Yossarian's brainless pilot, irritates Yossarian by flying his airplane a few inches above Yossarian's tent. Hungry Joe has screaming nightmares although he denies them each morning, and he gets into fistfights with the cat that belongs to his roommate. Chaplain Tappman, along with his assistant, has been ejected from the Officers' Headquarters and spends his time peacefully in the woods on the periphery of camp. He tries to stand up against Colonel Cathcart on Yossarian’s behalf, but he is too spineless. His assistant, the atheistic Corporal Whitcomb, constantly abuses the chaplain and collaborates with Colonel Cathcart to have the chaplain court-martialed.
Likewise, the commanding officers engage in squabbles and pointless activities. General Peckem and General Dreedle vie pointlessly for power. However, since ex-P.F.C. Wintergreen, who is in charge of mail, destroys General Peckem's letters because of their verbosity, General Dreedle always wins. Meanwhile, Wintergreen repeatedly goes AWOL. Each time, he is punished by being forced to dig six-foot-deep holes. Colonel Scheisskopf is so obsessed with winning the weekly parades that he ignores his own wife's sexual overtures. Colonel Cathcart attempts to become a general by volunteering his squadrons for the most dangerous missions possible. He also tries to gain favor by constantly raising the number of missions that the men must fly to obtain leave. Major Major, who is newly promoted, hides in his office away from everyone else, pitting the C.I.D. men against each other by signing his name as “Washington Irving.”
After a cancelled mission to Bologna, Nately, one of Yossarian's colleagues, becomes love-struck with a whore he meets in an apartment. Aarfy and the other soldiers mock him, and the whore rejects Nately and says he is boring. Nately, however, insists that he wants to marry her. Captain Black sleeps with her repeatedly to torment Nately. When Yossarian attacks Nately in a fury, the whore blames him and tries to attack him. Shortly afterwards, Yossarian breaks the terrible news of Nately's death to her. She doggedly follows him from Rome back to his military camp and tries to kill him with a knife. Finally, Yossarian disposes of her by throwing her out of the back of an airplane. When he hears that her younger sister has been wrongfully driven away from Rome, he tries to find her.
Perhaps the most unusual officer is Lieutenant Milo Minderbinder. He starts his own enterprise called M&M Enterprises. He persuades everyone to join his syndicate by arguing that, because everyone has a share in M&M Enterprises, everyone profits from his work. Milo also tempts the officers with offers of delicious food such as lamb chops and fresh eggs doused in butter. He recruits people from both sides and, since he owns the planes for both sides, he charges each side a commission when they engage each other. Milo makes a critical business error when he purchases the entire crop of Egyptian cotton only to discover that there is no market for it. His attempt to destroy his own crop creates widespread fury, but Milo pacifies his angry clients by bribing the government to purchase it from him. At the end, Milo tries to persuade Colonel Cathcart to relieve him of the enterprise so he can fly missions like everyone else. At first, Colonel Cathcart agrees, but when he realizes how much work there is, he instead offers Milo all the planes he wants and any medals that may result from the men being killed during the missions.
The war takes an especially harsh toll on the men and their morale. Yossarian continuously opposes the war and Colonel Cathcart’s frequent increases in the number of missions that are required to obtain a leave. Yossarian argues with Clevinger that everyone is trying to kill him. He says that anyone who tries to make him fight is just as dangerous as the enemy. Yossarian's various attempts to be grounded fail. Doc Daneeka repeatedly refuses to grant him the orders, basing his arguments on the “catch-22”: if Yossarian were crazy, he would not object to flying the missions. But if he is not crazy and does not want to fly the missions, then he is capable of flying them and must do so. Chaplain Tappman pities Yossarian because of the latter's mentally debilitating state, and he appeals to Colonel Cathcart to have Yossarian go home. He is too spineless, though, to be effective. Clevinger argues that the war should be fought. He bases this conclusion on the intellectual argument that if they do not fight, others will be killed in their stead because of their own cowardice. Meanwhile, all the officers consider Yossarian to be crazy, and they merely dismiss him.
In protest against being forced to fly more than the required number of missions as designated by the Group Headquarters, Yossarian uses various strategies. At the beginning of the book, he flees to the ward and discovers that it is a haven. To prolong his stay there, he pretends to have a strange disease that makes him see everything twice. In combat, he takes evasive action during his flights to avoid being killed. He also turns back once, pretending that his intercom is defective. When Colonel Cathcart volunteers his squadron for the dangerous Bologna mission, Yossarian moves the bomb line on the map to deceive the men into thinking that it has already been captured, and the air strike is called off. Despite these tactics, he cannot avoid combat entirely and is haunted by the death of his comrades. At Avignon, Snowden is killed, and Yossarian has terrible memories of his attempt to save Snowden. After this traumatic experience, he walks around naked and watches Snowden's burial from a tree. Then, an otherwise unknown man, Mudd, is killed just two hours after his arrival and is dumped in his tent. Everyone denies the existence of Mudd, so he lies there despite Yossarian's protests. When Nately, Yossarian’s dear friend, is killed, Yossarian refuses to fly any more missions.
When the Air Force realizes that Yossarian cannot be dissuaded, the officers try to make a deal with Yossarian that will allow him to fly no further missions. The only catch is that the deal is ethically repulsive to him; they will send him home as long as he likes them. If he does not give in, he will be court-martialed for being involved in black market practices. Yossarian protests against such wrongful accusations, but the officers claim they are justified in jailing an innocent man to keep the war effort going. Left without any other choice, Yossarian runs away both to avoid a court-martial and to avoid Nately's whore, who is trying to kill him to avenge Nately's death. The confusion of wartime life is not resolved.