The first act opens in the home of the Grand Master of the Order of Calatrava, Rodrigo Téllez Girón. Here, a commander of the order, Fernán Gómez de Guzmán, urges his superior to seize the town of Ciudad Real in the name of Juana and Alfonso of Portugal. Girón decides to capture the city. The village and villagers of Fuente Ovejuna are introduced and speak of love. The Commander enters and attempts to take two of the women, Laurencia and Pascuala, back to his castle, but they resist and escape. King Ferdinand and Queen Isabella discuss the capture of Ciudad Real and vow to retake it. Later, two of the lovers, Laurencia and Frondoso meet in the forest. When the Commander approaches, Frondoso hides and watches as the Commander attempts to force himself on Laurencia. As the Commander has put down his crossbow, Frondoso steps out and takes it. As Laurencia escapes his grasp, Fronodoso points the crossbow at the Commander, but does not threaten him, leaving with only the crossbow as the Commander curses both of them.
 

Act II begins in the village with a discussion among the peasants that is interrupted by the entrance of the Commander. He demands Esteban, Laurencia's father, to allow him to have her but he refuses and the Commander takes this as an insult. A soldier enters and begs the Commander to return to Ciudad Real (Royal City) which has just been surrounded by the forces of Ferdinand and Isabella. After the exit of the Commander, Laurencia and Pascuala run on with one of the peasants, Mengo. They are met by another peasant girl, Jacinta, who is being pursued by the Commander's servants. When Mengo protects her, they are both seized by the Commander's lackeys who will whip Mengo while Jacinta is raped by the Commander and then given to his men. Shortly afterwards, Esteban agrees to allow Laurencia and Frondoso marry. The wedding proceeds but is interrupted by the Commander who arrests Frondoso, for his threat with the crossbow, as well as Esteban and Laurencia who protest his arrest.
 

The third act opens with the men of the village meeting to decide how to handle the situation. Laurencia, having been beaten and subject to attempted rape (though she beats off her attackers and escapes) enters and is not immediately recognized. She reprimands the men for not attempting to rescue her inspiring the men to kill the Commander. They exit and Laurencia gathers the women to join them in the killing. While preparations are being made to hang Frondoso, the band of villagers enters and kills the Commander and one of his servants. Flores, the surviving servant escapes and rushes to Ferdinand and Isabella to tell what has happened. The shocked rulers order a magistrate to the village to investigate. The villagers, celebrating with the head of the Commander, are told of the magistrate's approach. To save themselves, they decide not to name any individual in the Commander's death, only to say "Fuente Ovejuna did it". The magistrate proceeds to torture men, women and young boys on the rack but gives up after not receiving a satisfactory answer. Ferdinand and Isabella pardon the Grand Master and when the villagers enter and tell their story, they are pardoned as well.