Amy Dorrit is born in the infamous Marshalsea Prison of mid-nineteenth century England. Her father, Wiiliam Dorrit, has been imprisoned for being unable to clear his debts. Her broken spirited mother dies shortly after Amy is born. Amy grows up to be a young woman without any knowledge of the world outside the prison walls. She is not pretty like her elder sister, Fanny - the prison atmosphere seems to have stunted her physical growth. At the age of twenty-two, she looks like a child of ten, and is painfully aware of the fact. But she is the one on whom the entire family depends. She takes care of her father, who has lost his dignity through his long incarceration. She sends her lazy elder brother, Edward, out to work. Both she and Fanny earn their living working as seamstresses in the city. She also looks after Maggy, a mentally unsound young woman, and even Frederick, William Dorrit's brother. Amy soon gets to know her stern employer's son, Arthur Clennam. Arthur is a quiet, middle aged man, always serious and thoughtful, the complete antithesis of his strict, rigid, unyielding mother. Arthur had a bitter and lonely childhood, and a broken love affair in his youth has made him sad, but not bitter or cynical . He is extremely sensitive to other people's emotions and sentiments, and his feelings of pity for his poor employee leads him to take a further interest in Amy and her family. He also knows that his mother is somehow responsible for the condition of Amy's family. While Arthur's interest in Amy seemed to be confined to paternal kindness and benevolence, the young, inexperienced Amy soon finds herself getting interested in this quiet, sensitive, pensive man.
Arthur is introduced to Daniel Doyce by his friend, Mr. Meagles. Doyce is an old man, and by profession he is an engineer. His factory is in Bleeding Heart Yard, a neighbourhood of the poorest people in society. Doyce and Arthur enter into a partnership and Arthur is frustrated by the corruption and inefficiency of the “Circumlocution Office”, a government department which grants licenses and patents. The book contains a searing satire on the workings of bureaucrats at government offices.
Arthur soon falls in love with Mr. Meagle’s twenty year old daughter, Minnie, and learns a little more about himself.
Through Arthur’s efforts, William Dorrit is released from prison. The life of the Dorrit family changes dramatically overnight. Amy and Arthur are separated, as she is forbidden from contacting him or meeting him. In the midst of new circumstances, Amy Dorrit has to deal with many heartaches, and finally comes to terms with her feelings for a particular man even as Arthur Clennam reflects a little more on his feelings toward a certain young woman.
By the time we reach the last chapter, both the main characters have suffered, and found strength in their feelings for others. And they do get to have the proverbial happy ending; ironically, in the same Marshalsea prison room where Amy Dorrit, her father, and the rest of her family, spent many miserable years.