Past the Shallows opens with brothers Harry and Miles at Cloudy Bay Beach with their older brother Joe. While Joe and Miles surf, Harry, afraid of the water, searches the dunes for beach treasures, particularly the shark egg Miles suggested he find.
The narration shifts to Miles's perspective the next day at dawn as Miles goes out with his father and Jeff, a fellow alcoholic fisherman, to pilot the boat while the men dive for abalone. It is the beginning of his summer holiday from school, but Miles has to work with Dad. Miles thinks of how Uncle Nick purportedly drowned in the deepest part of the channel. Dad said Uncle Nick had left the pub to go out and check the mooring lines because there was a big winter swell. Nobody found any evidence of Nick's body, and people mostly forgot about it because it was the same night Miles's mother died in a car crash.
The narration shifts to Harry going to the Regatta with Aunty Jean. Harry is carsick on the way there, but is drawn to the various games and prizes once at the Regatta. He finds $20 on the ground and spends it on bags of candy and toys to give to Miles and his friend Stuart. On the way home, Aunty Jean buys groceries for the household but leaves the bags at the door. She and Dad don't speak, not since she made Dad buy Nick's share of the boat, leaving Dad in debt. Miles is too tired to show enthusiasm about Harry's loot from the Regatta. Miles tells Harry he is lucky he gets seasick because he'll never have to work on the boat.
Miles goes out on the boat again. Martin, another diver, treats Miles well on the boat. After being underwater for some time, Dad surfaces with a big haul of abalone. He smiles at Miles and says that a few days like this and they'll be back in business. The narration shifts to Harry's perspective as he walks across scrubland to give one of the bags from the Regatta to Stuart. He encounters a dog near the shack of an old man named George Fuller. While playing with the dog, Harry is startled by George leaving the shack and calling Harry's name.
After work, Miles goes surfing with Joe. They catch a few waves and then discuss how they have to pack up Granddad's house, where Joe has been leaving since he left the house at thirteen because Dad broke his arm. Aunty Jean is selling the property and Joe plans to sail off somewhere in the sailboat he has been restoring. Miles doesn't know how to tell Joe that things are bad at home.
In the morning, Miles is sick, and Harry is concerned. Miles assures him he is fine and tells Harry to go back to bed. That day on the boat, they finish early and Miles thinks he'll go surf with Joe again. Seeing Atlantic salmon rushing under the boat, the men cast lines and begin pulling fish into the boat. Suddenly a ten-foot shark chases one of the fish out of the water and lands in the boat. In the ensuing chaos, Jeff kills the shark by firing his rifle twice at the shark's head. Before it dies, the shark breaks Martin's leg while thrashing around. Miles accompanies Martin to the hospital and remembers how his Granddad died there.
Meanwhile, Harry revisits the dog, who he learns is named Jake. George welcomes Harry inside the warm and tidy home. They have tea together by the fire and George talks about how he rescued Jake from his cruel previous owner. The next day, the boat won't start. Miles suggests they shouldn't go out and Dad gets angry, storming off and leaving Miles to move the boat alone. Mr. Roberts, a more successful abalone fisher, helps tow it and then offers to give Miles a ride home. Miles thinks about how he used to be very close with Justin, Mr. Roberts's son, who now goes to private school. On the drive, they pass the tree where his mother crashed.
While helping Joe pack up their grandfather's house, Miles and Harry find pieces of their mother's car in the garage. Miles finds a shark-tooth necklace in the seat and holds on to it, though he can't remember who it belonged to. While Harry visits George, who teaches him to fish, Miles learns that Dad and Jeff have been poaching abalone illegally. Later, Harry is the only person home when officials from the fisheries department come to the house and ask to see Dad. While surfing, Joe and Miles discuss how Joe is planning to set sail in the boat he restored and leave the town behind. Miles lets his resentment be known, and Joe promises he'll come back for Miles and Harry.
One night, Jeff and Dad go on a two-day drinking bender at home, prompting Miles and Harry to try to avoid the men in their living room. Jeff calls the boys abusive names and force-feeds Harry whiskey with Dad egging him on. Miles intervenes and gets into a tussle with Jeff, falling and hitting his head. Dad yells about how he never wanted Harry. Miles and Harry leave the house that night, seeking refuge at George's.
The next day Miles brings Harry to stay at Harry's friend Stuart's house while he returns home and cleans up his own blood and the mess Jeff and Dad made. Dad and Miles pretend like nothing happened. After work, they nearly run into Harry on the road. Dad becomes very angry when he realizes Harry had been at George's. In the morning, he punishes Harry by bringing him out on the boat with Jeff and Miles. While Jeff and Dad are diving, Miles panics because the boat engine shuts off and he can't restart it. Without an air supply, Dad rescues Jeff and bring him on board. Dad becomes livid, blaming Miles for the faulty engine and dunking his head in the water so he knows what it feels like to drown. Harry defends Miles, kicking at Dad's legs. Dad is amused until Harry gets on the radio and calls for help, announcing their location. Dad is furious at Harry for alerting the authorities, because they are diving illegally in protected waters.
In the novel's climactic scene, Dad holds Harry against the boat railing and finds the shark-tooth necklace Miles gave Harry to wear earlier that morning. Dad recognizes that it once belonged to Uncle Nick. Miles recalls how Uncle Nick was in the car with them the night Mum died, and had given him the necklace. The narrative implies that Harry was in fact Nick's son biological son, and Mum and Nick had been eloping together with the boys on the night of the crash. After the crash, Dad had pulled Nick from the vehicle and murdered him, disposing of his body in the bay.
Just as a swell comes over the side of the boat, Dad pushes Harry into the water. After both Jeff and Dad hold Miles in the boat briefly, Miles gets free and dives into the water. He swims with Harry on his back, but isn't able to fight the fatigue that comes with hypothermia setting in. Miles wakes up in the hospital with Joe at his bedside. Joe informs him that Harry's body was found washed up on a reef.
The novel ends with Joe, Miles, and George at Cloudy Bay beach, where they bury shells and driftwood Harry had collected. Miles recalls how he planted the shark egg from the first scene in the book for Harry to find. George reveals that he found Harry's body. After George leaves, Joe and Miles return to the sailboat, where Miles now lives. He feels at peace and thinks about what paths lie beyond the shallows as he looks over the ocean.
