Bassanio wants to marry an heiress called Portia, who he considers ‘fair’ and full of ‘wondrous virtues’; but he needs money to win her hand. He asks his friend Antonio, a wealthy Venetian merchant, for a loan. Antonio admits that he has no money available to give him as his ‘fortunes are at sea’ and invested in cargo ships. However, he tells Bassanio that he will find a way to get some money for him.

Bassanio and Antonio meet the Jewish moneylender Shylock and ask for ‘three thousand ducats for three months’. We learn that Antonio has treated Shylock very badly in the past but Shylock agrees to lend him the money. Shylock’s terms are that if Antonio is unable to repay the loan within the given time, Shylock will be entitled to take a pound of Antonio’s ‘fair flesh’.

Portia and Nerissa, her waiting woman, discuss the ‘lottery’ that Portia’s father set up in his will. Anyone wanting to marry Portia must choose one of three caskets which are made of gold, silver and lead. If they choose the casket containing Portia’s portrait then they may marry her, but they may only pick one casket. Portia and Nerissa make fun of all of the suitors who have tried and failed so far.

In Belmont, first the Prince of Morocco and then the Prince of Aragon come to take the challenge for Portia's hand in marriage and her fortune. The Prince of Morocco chooses the gold casket, which is wrong. The Prince of Aragon chooses the silver, which also turns out to be incorrect.

Lancelet Gobbo is Shylock’s servant. He expresses his wish to leave his master, as he thinks Shylock is a ‘kind of devil’ and then plays a trick on his blind father, Old Gobbo. After this, he talks to Bassanio about working for him instead.

Shylock’s daughter, Jessica, plots to escape from her father’s house and run away with Lorenzo, who is a Christian. To escape, she disguises herself - ‘transformed as a boy’ - and runs away during the night, while Shylock is away. She is helped by Gratiano, Lancelet, Salanio and Lorenzo and also steals money and jewels from her father.

Shylock discovers that his daughter and his ‘ducats’ have gone missing and searches furiously in the streets for Jessica, who has also taken a turquoise ring that belonged to his late wife. He is devastated that the ring has gone and tells his friend Tubal he 'would not have given it for a wilderness of monkeys'. There is also news that one of Antonio’s ships has been lost and ‘wracked on the narrow seas’.

There is more news of Antonio losing ships at sea. Salanio and Salerio ask Shylock whether he has heard the reports. Shylock tells them that all he cares about is that Antonio will ‘look to his bond’ and reminds them how badly Antonio has treated him in the past. Shylock tells them that, as a Jew, he is just as human as a Christian is and suffers the same as any other man - asking 'if you prick us do we not bleed?'

Bassanio is in Belmont and is about to choose a casket but Portia asks him to ‘tarry’ and to wait before he makes his choice. She is scared that if he chooses the wrong one then she will lose him, as he is the first suitor she’s genuinely interested in. Bassanio goes ahead anyway, saying that not knowing the outcome is as torturous as being on the ‘rack’. He picks the lead casket and wins Portia’s hand in marriage. Gratiano and Nerissa also marry.

Bassanio receives a letter from Antonio full of the ‘unpleasant’st words’ explaining that all of his ships have been lost and that he has no money to pay Shylock back with. This means that Shylock will be entitled to take the ‘pound of flesh’ from Antonio’s body. Bassanio explains to Portia that he is the reason that Antonio is in this situation. Portia offers to repay double what Antonio owes and she urges Bassanio to go to Venice to help his friend. Before he leaves, she gives him a ring and makes him promise that he’ll never lose it.

Portia is determined to help Bassanio and Antonio. Lorenzo and Jessica have run away to Belmont and are now waiting there, so Portia pretends to Lorenzo that she is going to go and stay in a monastery ‘in prayer and contemplation’. In reality, she and Nerissa go to Venice disguised and dressed as men - ‘accoutred like young men’.

In the Venetian court, the Duke says he hopes that Shylock will show ‘mercy and remorse’ and not claim his ‘bond’ from Antonio. Bassanio even offers to repay double the sum of money Antonio owes, given to him by Portia, but Shylock refuses. He is determined to have the ‘pound of flesh’.

The Duke tells the court that he has sent for Bellario, a ‘learned doctor’, to judge the case. Nerissa enters, dressed as a lawyer’s clerk and delivers a letter explaining that ‘Balthasar’ is coming in Bellario’s place. Unknown to everyone else ‘Balthasar’ is actually Portia, in disguise as a man. 'Balthasar' encourages Shylock to show mercy and admits that Shylock is entitled to take the pound of flesh, but then points out that there is ‘no jot of blood’ mentioned in the bond. With this in mind, 'Balthasar' tells the court that Shylock can take the flesh, but he must not cause Antonio to bleed in the process.

Shylock realises that it will be impossible for him to take Antonio's flesh without shedding any of his blood. He admits defeat and asks to leave. ‘Balthasar’ announces that under the law of Venice, as Shylock has attempted to take the life of a citizen, all of his wealth will be seized. Half will go to Antonio and half will go to the city of Venice. Shylock must also ‘presently become a Christian’.  

Bassanio offers ‘Balthasar’ money as thanks for ‘his’ help in saving Antonio but 'he' refuses the money and asks for his ring instead, allowing Portia to test how much her love and his promise really mean. Bassanio is reluctant to hand it over but Antonio encourages him to ‘let him have the ring’ nonetheless. Nerissa, still dressed as the clerk, also succeeds in persuading Gratiano to give her the ring that she had given him at Belmont.

Portia and Nerissa succeed in getting back to Belmont before the men. When they arrive they tell Jessica and Lorenzo not to mention to anyone that they have been ‘absent’. When Antonio, Bassanio and Gratiano arrive, Portia and Nerissa draw attention to the lost rings and tell their husbands off for losing them.

After telling the men off for breaking their promises and giving away their rings, Portia and Nerissa reveal that they were the lawyer and the clerk in disguise at the Venetian court. Portia gives Antonio a letter which contains news that three of his ships have in fact ‘richly come to harbour suddenly’. Nerissa explains to Jessica and Lorenzo that they will inherit Shylock’s wealth when he dies.