This novel begins as a third-person story about an unfaithful man named Guy Bishop. He leaves his wife and high-school-age sons (Philip and Keith) to go live with another woman. His wife eventually recovers, and Philip copes by hating his father, but Keith never gets over his grief, which sends him on a downward spiral. Philip, feeling out of place and unmotivated, decides to enlist in the military. He goes to the marine recruiting office but it's closed, so he joins the army instead and gives his car to Keith.
In Chapter 2, the novel suddenly switches to the first-person perspective of Philip, who becomes the novel's main character. While he's training at jump school for the Army, his mother calls and tells him that Keith has disappeared in San Francisco, and Philip's car was seen being inhabited by homeless hippies. A fellow trainee, forgetting to pull his reserve parachute, dies on the same training jump as Philip.
Philip is stationed at Fort Bragg, an Army base in North Carolina. On the Fourth of July, he is stationed on guard duty at an ammunition dump with two other paratroopers, Hubbard and Lewis. While they take turns on shifts, they talk; Hubbard is a goodhearted, peaceful young man who doesn't want to kill anyone and dislikes the army, while Lewis tries to portray himself as a womanizing tough guy, with little success because of his nervous tics, irritating mannerisms, red face, and swollen hand. Philip, for his part, is a selfish, dissociative man with little regard for morality or the well-being of others. Two men approach the fence they're told to guard and warn the three troopers that there's a fire nearby that could very easily send sparks into the ammo dump and blow it up, so their lives are in danger. Lewis and Hubbard, taking their orders seriously, threaten these men with their weapons until they leave. They survive because the ammo dump doesn't blow, and despite their foolishness, they share a time of bonding and solidarity.
A few days later, Philip is assigned to crowd control for a nonviolent protest, where a young man and woman ask why they want to kill their brothers in Vietnam. This protest rattles the unit, which becomes uncharacteristically sober. A couple of days after that, the thefts begin; a corporal's wallet is cleaned out, and a man's fatigue pants are stolen and emptied of their money. The thief also takes Hubbard's pants and money and breaks his nose.
The story then jumps back in time a few days and starts following Lewis in the third person. Hitchhiking, he is picked up by a mild-mannered teacher who tends to his infected hand. After this pleasant encounter, Lewis goes to the movie theaters for a few minutes before suddenly leaving and shattering the bottle of lotion the teacher gave him, declaring that he isn't a Tinkerbell. He then tries everything he can to get laid for free, and eventually he follows a prostitute home and tries to negotiate price with her. She says ten dollars, and he gives her six and promises to return the next day with more. To get this money, Lewis starts stealing from fellow army men (hence the title "The Barracks Thief"). From the first two thefts, he gets enough money to sleep with the prostitute once, who then pulls a knife on him and tells him to get out. Lewis then steals Hubbard's money and tries to go back, but he can't find her. He does, however, find liberation by howling at the moon.
The next day, Lewis is outed as the thief, and he collapses in some sort of mental fit. That night, several men (including Philip) have a "blanket party," covering Lewis with a blanket and beating him up. Lewis is dishonorably discharged, and Philip finds himself estranged from all of the men in his barracks.
Jumping ahead in time, Philip looks back on the last few years. Lewis is probably doing fine, and Hubbard deserted before he was shipped off to Canada. Philip himself is married and "a good neighbor" now, and he looks back on that foolish event at the ammo heap on the Fourth of July, pondering the nature of the lives of those three men.
