Sophie, a young orphned girl living in London, is snatched by a giant through her window and whisked off to Giant Country. There, the giant introduces himself as the "Big Friendly Giant", or "BFG" for short. The BFG tells Sophie that she must remain in Giant Country forever to keep her from exposing the existence of giants.
The BFG gives Sophie a nightmare about being eaten by another giant as a warning. Shortly afterwards, the BFG is visited by the Fleshlumpeater, the leader of the giants, who nearly discovers Sophie before being tricked into leaving. Sophie convinces the BFG to take her to Dream Country, but as they leave, they awaken the other giants, who torment the BFG before being scared off by a thunderstorm, allowing the BFG and Sophie to escape. As they do, the Fleshlumpeater find Sophie's blanket and realize that the BFG is hiding a human.
Sophie and the BFG arrive in Dream Country and capture several dreams before arriving in London to spread good dreams to sleeping children. As they do, Sophie notices she is missing her blanket, and the BFG realizes the other giants know about her. Dropping Sophie off at the orphanage, the BFG confesses that he once took another children to Giant Country, and he was found and eaten by the other giants. In spite of this, Sophie convinces him to let her return so they can figure out a way to stop the other giants. Returning to Giant Country, the BFG is confronted by the other giants, who demand to know where Sophie is. However, the BFG stands up to them and manages to scare them off.
While hidden, Sophie discovers a portrait of Queen Victoria in the home of the last child who lived with the BFG. From this, she devises a plan to alert Queen Elizabeth II, the Queen of the United Kingdom. Arriving at Buckingham Palace in London, the BFG gives Elizabeth a nightmare consisting of giants eating children, and she discovers Sophie on her windowsill. The BFG reveals himself to Elizabeth and he and Sophie explain that the man-eating giants are real. The Queen promptly dispatches soldiers to Giant Country to capture the giants. To assist, Sophie and the BFG give the sleeping giants nightmares, consuming them with guilt. However, the Fleshlumpeater awakens and tries to kill Sophie, but is stopped by the BFG. The giants are then captured and marooned on an uncharted island.
In the aftermath, Sophie is adopted by Elizabeth's assistant Mary and lives in Buckingham Palace. The BFG, meanwhile, returns to Giant Country and begins growing a wide variety of vegetables inspired by his time in England.