Percy Jackson is a thirteen-year-old boy living in Manhattan with his mother, Sally. While he's in seventh grade like any normal teenager, his life is a little different, since Percy is a demigod: half-god and half-human. Last summer, Percy found out that he was the son of Poseidon, the Greek God of the sea. In this universe, the Greek gods still exist and have adapted to modern-day life as Western civilization continues to develop. Their demigod children face danger from mythological monsters, who are able to locate demigods through smell, but are protected by living during the summer or the whole year at Camp Half-Blood, a camp on Long Island where demigods are safe from monsters.
The book opens with Percy having a nightmare about Grover, his best friend who is also a satyr from Greek myth. In the dream, Grover appears to be running away from an unknown monster. Uneasy, Percy finds out from his mother that things are not quite right at Camp Half-Blood either, foreshadowing the later events of the novel. As Percy heads to his last day of school, we are introduced to a new character by the name of Tyson, who Percy feels the need to protect from bullies. But when the visiting students turn out to be Laestrygonians, man-eating giants from The Odyssey, Tyson proves himself to be more than human through his ability to resist fire. Things start moving fast when Annabeth, one of the friends Percy made last summer and a daughter of Athena, shows up to take Percy to camp. She's taken aback by Tyson and is unfriendly towards him, but invites him along anyways. Driven in a cab by the Grey Sisters, the three of them are given mysterious numbers before they're dropped off at Half-Blood Hill. Strangely, the campers, led by Clarisse, are in the middle of a battle. This should be impossible due to the magic of Thalia's tree, but as they quickly find out, the tree has been poisoned. Thalia was the teenage daughter of Zeus who sacrificed her life to save Grover, Annabeth, and their friend Luke when they were all trying to get to Camp Half-Blood. As she was dying, her father Zeus turned her into a tree that protects the campers from the invasion of monsters. But now that her tree has been poisoned, the magical borders that protected demigods from monsters on the outside are no longer working. This is especially bad since they are about to be at war with Kronos, the Titan of time who was resurrected last summer after Percy was accused of stealing Zeus' lightning bolt. In other revelations, Chiron (a centaur) and Argus (a giant with a hundred eyes)—the old camp leaders—have both been fired. They go to visit Chiron, who has been a mentor for both Percy and Annabeth, and he tells them that he is under suspicion of poisoning the tree. He also mentions a mysterious prophecy and urges Annabeth to keep Percy safe.
The surprises don't stop there. As Percy struggles to adjust to the new camp atmosphere, we learn that Tyson is not only a Cyclops but Percy's brother. Also, the camp is now being run by Tantalus, a ghost from the Fields of Punishment who is punished by never being able to reach the food that he always has in front of him. He shows a lot of favoritism towards Clarisse and has a strong bias against Percy and Annabeth. Meanwhile, Percy keeps having dreams about Grover. It turns out that he's been trapped by a Cyclops, who we eventually learn is the monster Polyphemus from The Odyssey. After a stressful chariot race, Percy and Annabeth put their heads together and figure out from the hints in Percy's dream that Grover must be in the Sea of Monsters, which is located in the Bermuda Triangle in modern times. More specifically, Grover is near the Golden Fleece. This is highly convenient, because the Fleece can save Thalia's tree, meaning that if they manage to find it and free Grover, they'll be killing two birds with one stone. Using peer pressure, they convince Tantalus to sponsor a quest. He turns it back on them, though, by nominating Clarisse as the hero that should go. Percy is frustrated and goes that night to the beach to figure out how he could possibly sneak out to join the quest himself. There, he meets Hermes, the god of travel and mischief. He encourages Percy to sneak out, giving him supplies, including magical vitamins that can heal almost any ailment, as well as money. His only request is that Percy try to talk to Luke—Hermes' son who turned his back on the gods and who betrayed Percy last summer—and to try to convince him to switch allegiances.
Percy's chance comes sooner than he expects. As he finishes speaking with Hermes, Tyson and Annabeth come running down the beach. With the help of three hippocampi (mythical horse-fish hybrids) sent by Poseidon, they head towards a cruise ship in the distance to start their journey. When they get on the ship, they notice something is off immediately, but decide to turn in for the night. After having another dream about Grover, Percy wakes up and heads to the deck with his two companions, only to find out that the whole ship is occupied by monsters. They investigate more and discover that the ship is being commanded by Luke, who is using it as his base of operations for Kronos's war. While they're able to learn that Luke is the one who poisoned Thalia's tree, they're quickly captured. During the confrontation, Luke gives Percy and Annabeth the option to join him, but after they refuse, he tells his monster guards to feed them to the dragon.
The three of them manage to escape on a rowboat, but it's almost a little too convenient. As they speed away, Percy discovers that he has innate nautical senses, and is able to direct their boat towards a safe house she knows near the Chesapeake Bay. Percy and Annabeth rest for a moment while Tyson goes to get food. Annabeth, who still isn't comfortable around Tyson, shares that this was a place that she, Luke, and Thalia found in the days before they came to Camp Half-Blood and Thalia died saving their lives. She's about to share more, but is cut off by Tyson returning with donuts he found from a nearby chain restaurant. Annabeth is suspicious, since they're in the middle of nowhere. Her caution proves to be correct when it turns out that the restaurant is a cover for a Hydra. They're almost killed but are saved by a cannonball fired by Clarisse, who is captaining a ghost ship given to her by her father, Ares, the god of war. She takes them prisoner and tells them they've been expelled from camp for life. The imprisonment proves to be more of a suggestion as they enter the Sea of Monsters, where they soon need all hands on deck. Clarisse chooses to pass by Scylla and Chardbis, two monsters that Odysseus also faced during his travels, but pushes the engine too hard. Tyson goes down to fix it but is too late, and the engine explodes. Percy and Annabeth manage to get clear, but Tyson is lost.
Somber, Percy and Annabeth continue on. Annabeth mentions that the important prophecy that has been on their minds for some time suggests that a child of the Big Three (Zeus, Poseidon, and Hades) will hold the destiny of Olympus in their hands when they turn sixteen. This is likely why Percy is so important to Kronos, who sees him as a potential tool to use against the gods. Percy wants to know more, but Annabeth goes silent until they arrive at a mysterious beautiful island. The mistress of the island appears to take both of them under her wing, but when she turns Percy into a guinea pig, we realize that she is actually Circe, the mythical sorceress. She offers Annabeth an offer to learn from her, but Annabeth instead tricks Circe into giving her an opening to free Percy and the other men she has trapped. They run, stealing a pirate ship to escape the island. Right after their escape, Percy learns that Annabeth doesn't like Cyclopses since one almost killed her as a child, allowing the monsters to catch up to them at Half-Blood Hill and kill Thalia. After that revelation, they encounter the Sirens. Annabeth insists on listening to them but suffers a close call when she manages to get free of her bindings. The experience helps her realize that her fatal flaw is pride, and she cautions Percy to be careful of his, whatever it might be.
After this, they finally arrive at Polyphemus's island. They see the Fleece immediately, but it's guarded by man-eating sheep. Making their way to the caves, they discover that Clarisse has beaten them there. Clarisse is reckless and ends up getting both herself and Grover captured when she reveals that Grover is a satyr. (Grover, taking advantage of Polyphemus's damaged eyesight, has been pretending to be a female Cyclops to stall getting eaten.) This proves to be a dilemma since Percy and Annabeth are too weak to move the rock in front of the cave to get to their friends. Annabeth cleverly decides to rehash Odysseus's old strategy by calling out that she's Nobody while Percy sneaks around behind the sheep. This works, but unfortunately, Polyphemus injures Annabeth in the process and begins to attack the other three. They fight him, running to the bridge. Percy has Polyphemus trapped, but when he begs for his life, Percy can't manage to kill him. Polyphemus takes advantage of this goodwill and rallies.
Out of the blue, a giant rock sends Polyphemus over the bridge into the chasm. It's Tyson—it turns out that the hippocampus he met during the beginning of the trip really liked him, and had been following him since they got on the ship Princess Andromeda. When Tyson was caught in the explosion, Rainbow was there to save him. Tyson proves to be even more important when they realize that the sheep find his Cyclops smell familiar, enabling him to wade through the sheep and grab the Fleece. Polyphemus comes out of the chasm, but this time, Percy and Tyson fight him together. Together, they subdue him and escape the island on hippocampi. The hippocampi take them as far as the shores of Miami, where they have to decide how to get the Fleece back to camp. Ultimately, they decide to send the Fleece, which is disguised as a letterman jacket, with Clarisse on a flight to New York with the money they have remaining from Hermes.
It turns out to be perfect timing since Luke turns up right after. He wanted to use the Fleece to resurrect Kronos. Percy's quick thinking allows him to set up an IM (Iris Message, which refers to the way that demigods communicate with each other since they can't use phones) so that the entire camp can see Luke confessing to poisoning Thalia's tree. Feeling good, Percy challenges Luke to a sword fight. Percy is losing the fight until he's saved in the nick of time by Chiron and his Centaur relatives. They take the three of them away from the cruise ship and to their own encampment, eventually using their super speed to take the friends back to Camp Half-Blood. They arrive just in time to see Clarisse put the Fleece over the tree, and Thalia's tree starts healing immediately. The summer starts looking up, but when he meets Hermes one last time, Hermes gives him a message from Poseidon, telling him to brace himself. The reason reveals itself a couple of days later when Percy wakes up from restless dreams to find Grover banging on the door. It turns out that the Fleece worked too well: it brought Thalia back, giving Kronos another person he can use to fulfill the prophecy.
