Tilly Dunnage returns to her hometown, Dungatar, in the Australian outback, in 1951. 25 years prior, she was sent away after allegedly killing a young boy, Stewart Pettyman, in the schoolyard. Since then, she has become an accomplished dressmaker, studying in Paris and making a name for herself in the fashion world. Upon returning to the town, she finds that her mother, Molly, who was always labeled the town "slut," has declined into mental illness and is living in a dilapidated house. She fixes up the house and begins a new life in Dungatar, determined to learn more about the tragic death in her childhood and to take care of her mother.
After causing a stir by showing up to a local football game in couture, Tilly begins making dresses for local women who want to transform themselves. She helps the homely Gertrude win over the wealthy William, and makes over several other townspeople. In the process, she attracts the attention of the young Teddy, who falls in love with her and begs her to be with him, in spite of her protestations that she is "cursed."
After helping Gertrude snag her husband, Tilly asks to know more about the day of Stewart Pettyman's death, and Gertrude tells her that she is the one who told Stewart, a bully, where Tilly was hiding. She also learns from the constable, Sergeant Farrat, that the councilor and Stewart Pettyman's father, Evan Pettyman, blackmailed him into sending Tilly away as a girl. Not only that, but in the present, Pettyman hires a rival dressmaker, Una Pleasance, to come and compete with Tilly's dressmaking business. Luckily, however, she is no match for Tilly.
At Gertrude's wedding, Farrat reveals to Tilly that Evan Pettyman is her illegitimate father. After that, Teddy tells her the story of Stewart Pettyman's death. After bullying Tilly on the schoolyard, Stewart charged towards her like a bull, but she moved out of the way just in time for him to run into a brick wall and break his neck. After telling her the story, Teddy jumps into the silo to impress Tilly, but drowns in the grain that is inside. Heartbroken, Tilly goes to Molly's and they strategize about how to enact revenge on the town. Soon after, however, Molly dies of a stroke.
Before she dies, Molly signs Tilly up to make costumes for another town, Winyerp, in a drama competition that is going on between Winyerp and Dungatar. Tilly goes to Mrs. Pettyman, the much-abused wife of Evan Pettyman, and tells her about his misdeeds. Mrs. Pettyman kills her husband. Tilly's costumes for Winyerp's production are far superior to Dungatar's, and Tilly leaves town, but not before lighting the whole town on fire.