Montana 1948 is set in a small town on the very northeastern edge of the state of Montana. The events described are experienced through the eyes of David Hayden, a twelve-year-old boy. In a prologue, he describes several images he remembers vividly from forty years ago. Years later, after both of his parents are dead, David decides to tell the whole story of the tragedy he witnessed as a boy.

At the time of David’s narrative, he lives with his parents in the small town of Bentrock, Montana (population of about 2,000). His father is the county sheriff. His mother also works, as a secretary, so David’s parents have hired a local Native American woman as a combination housekeeper and babysitter for their son. 

This woman, Marie Little Soldier, falls ill, and David’s father summons his brother Frank, who is a doctor. Marie objects to having the doctor examine her but David’s father insists on it. After the doctor’s visit, Marie tells David’s mother why she refused to see him: the doctor has been sexually abusing Native American girls, and Marie was afraid to be alone with him. 

David’s mother passes on the information to her husband and urges him to take action against his brother for his crimes. David’s father begins to investigate and gathers evidence that confirms Marie’s accusations. 

A few days later, Marie dies. David has seen his Uncle walking from the house and suspects foul play.  Len, the deputy sheriff, who lives next door, is also a witness to Frank’s presence at the house when Marie died.

David’s Uncle Frank has, in fact, murdered the young woman to keep her quiet. David’s father takes his brother into custody and locks him in the basement of his own home to avoid scandal. 

This makes David’s grandfather, a powerful local rancher and former sheriff, furious and he sends four of his hired hands to bust Frank out. David’s mother fires a shotgun to keep the cowboys away, and the deputy sheriff hears the shot and comes to defend David and his mother.

On the day David’s father has chosen to move his brother to the town jail and to start formal legal proceedings against him, his brother commits suicide.

David’s grandfather is furious and severs ties with his surviving son. David and his family move out of state to escape the scandal and family bitterness.