A boy named Shō (Shawn in the Disney dub) tells the audience he still remembers the week in summer he spent at his mother’s childhood home with his maternal great aunt, Sadako (Jessica in the Disney dub), and the house maid, Haru (Hara in the Disney dub). When Shō arrives at the house on the first day, he sees a cat, Niya, trying to attack something in the bushes but it gives up after it is attacked by a crow. Shō gets a glimpse of Arrietty, a young Borrower girl, returning to her home through an underground air vent.
At night, Arrietty’s father, Pod, takes her on her first “borrowing” mission, to get sugar and tissue paper. After obtaining a sugar cube from the kitchen, they travel inside a hollow wall to a bedroom which they enter through an intriguing dollhouse with working electric lights and kitchen utensils. However, it is Shō’s bedroom; he lies awake and sees Arrietty when she tries to take a tissue from his night table. Startled, she drops the sugar cube. Shō tries to comfort her, but Pod and Arrietty quietly leave and go home.
The next day, Shō puts the sugar cube and a little note beside the air vent where he first saw Arrietty. Pod warns Arrietty not to take it because their existence must be kept secret from humans. Nevertheless, she sneaks out to visit Shō in his bedroom. She drops the sugar cube on the floor, letting him know that she is there. Without showing herself, she tells Shō to leave her family alone and that they do not need his help. On her return, Arrietty is intercepted by her father. Realizing they have been detected, Pod and his wife Homily decide that they must move out. Shō learns from Sadako that some of his ancestors had noticed the presence of Borrowers in the house and had the dollhouse custom-built for them. The Borrowers had not been seen since, however.
Pod returns injured from a borrowing mission and is helped home by Spiller, a Borrower boy he met on the way. He informs them that there are other places the Borrowers could move to. While Pod is recovering, Shō removes the floorboard concealing the Borrower household and replaces their kitchen with the kitchen from the dollhouse, to show he hopes them to stay. However, the Borrowers are frightened by this and instead speed up their moving process.