Narrated by an unnamed third-person omniscient narrator, "The Doll's House" opens with the narrator commenting on how Mrs. Hay, who recently stayed with the Burnell family, sends a doll's house to the daughters as a gift. The doll's house is large, elaborate, and smells strongly of its fresh, spinach-green paint. The Burnells' servant opens the latch that allows the house to swing open and reveal the delicately decorated rooms. The Burnell children are amazed. Kezia, the youngest Burnell, becomes fixated on a little amber lamp with a white globe that appears to be filled with oil.
At school, the Burnells boast about their dollhouse to the other girls, all of whom are enraptured by the girls' descriptions. The narrator comments on how the Burnells attend a school that their parents do not approve of; they go to the school because it is the only school in the area. The parents disapprove of how their daughters mix with children from lower social classes. The girls mix with the children of the grocer and milkman, but their parents draw a line at Lil and Else Kelvey, who are the daughters of a poor washerwoman and an absent father rumored to be in prison. Everyone at school, including the teacher, shuns the Kelveys, who hover at the edge of the circle of girls listening to Isabel Burnell boast about the doll's house.
Every day after school the Burnells invite two girls to view the doll's house in their courtyard. The fame of the doll's house spreads. The Kelveys sit to the side and listen while eating their lunch. Once every girl has seen the doll's house, Kezia asks her mother if she can bring the Kelveys as well. Her mother tells her certainly not. When Kezia asks why not, her mother tells her that she knows quite well why not.
One day the girls at school decide to be especially horrible to the Kelveys. They start a rumor that Lil is going to grow up to be a servant. Lena shows off to other girls by walking over to Lil and asking her if she is going to be a servant when she grows up. When Lil merely smiles in response, Lena grows indignant and hisses that Lil's father is in prison. The cruel girls become wild with joy at the audacious comment and proceed to skip rope with more daring than ever before.
That afternoon the family servant picks up the Burnells in a buggy and tells them that visitors are coming for dinner. While Isabel and Lottie change into pinafores upstairs, Kezia goes to the courtyard and looks out the gates. She sees the Kelveys approaching and invites them in to see the doll's house. The Kelveys are stunned. Lil tells Kezia that her mother said Kezia's mother said they are not allowed to speak to each other. Kezia says they can see it all the same. Lil is hesitant but Else wants to see it. The girls slip through the gate and follow Kezia in.
The girls marvel at the doll's house interior. Just then Kezia's aunt Beryl comes into the courtyard and shouts at her for bringing the Kelveys in. She shoos the Kelveys away as though they are animals.
The story ends with the Kelveys walking far from the sight of the Burnells and sitting on the side of the road. Else snuggles close to Lil and, having forgotten about the angry lady, says, "I seen the little lamp." The girls sit in silence.
