The novel begins with a brief introduction of Leo's life and chronicles his moving from his home state of Pennsylvania to Arizona, at the age of twelve. Before his move, his uncle Pete gives Leo a porcupine necktie as a farewell present, inspiring him to collect more like it. For a while, his collection still contained only one porcupine necktie until his birthday, when he receives one in a gift-wrapped package that an anonymous person left on his doorstep.
This story picks up four years later with the arrival of an eccentric new classmate, Susan Caraway. Her behavior is unusual for a teen at Mica Area High School which prizes student conformity above all else. She wears kimonos, Native American buckskin, 1920s [flapper] clothes, and pioneer clothing with no makeup.
During each class period she decorates her desk with a tablecloth and a vase with a daisy in it. She dances in the rain. She strums a ukulele during lunch every day and sings "Happy Birthday" to kids she has never met. She once yelled "Opokolo" out loud during lunch for no apparent reason. She attends other peoples' funerals and, during sporting events, cheers for both teams. Her behavior is so unusual and so unlike anything anyone at the school had seen before that the student body at first did not know what to make of her. One student, the popular Hillari Kimble, declares, "She is not real."
Leo becomes infatuated with Stargirl and refuses pleas of his best friend, Kevin, to put her on their show Hot Seat, the school’s student run television production where students are placed on the spot, and a jury of fellow students ask them questions "to make them squirm." Because Leo is infatuated with Stargirl, he doesn’t want to embarrass her on the show. Once the student body becomes accustomed to Stargirl’s eccentricities and Mallory Stillwell invites her to join the cheerleading squad, her popularity soars. Students begin to mimic her behavior, and at lunch, her table is overflowing with peers. She joins the cheer squad and goes to games for all of the sports, and the attendance at games suddenly booms. She sparks a revolution against conformity in the school.Then she cheered and cheered.
When Hillari Kimble, the girl who was the most popular in school before the appearance of Stargirl, demands Stargirl not to sing to her on her birthday, Stargirl keeps her promise—she does not sing to Hillari, but she sings to Leo, only she says Hillari's name. When Kevin, Leo's best friend, asks Stargirl, "Why him?", she responds by tweaking his earlobe and saying, "He's cute."
Leo does privately celebrate the outburst of individuality taking over the school, even though his own shy demeanor keeps him from participating himself. He is merely a spectator in the events that follow.
The basketball season brings about Stargirl's downfall. For the first time in the school's history, they have an undefeated basketball season. She slowly begins to anger her school by cheering for not only MAHS, but the other teams as well. She doesn't believe winning is the only way to have fun, and this puzzles and angers the students, though this is the same behavior she exhibited as a cheerleader for the football team.
Shortly after the beginning of the basketball controversy is Stargirl's "Hot Seat" appearance. The show starts innocently, however, things slowly turn sour as the students begin to attack Stargirl with questions that single her out and attempt to embarrass her. As events get out of control the advising teacher cuts the show short. It never airs but the events are quickly revealed to the school by the members of the Hot Seat jury.
When basketball play-offs come around, the school faces tough competition, and, unfortunately, lose in the semi-finals. Stargirl angers the school by comforting a player from the opposing team when he breaks his ankle. This leads to her ultimate downfall from popularity. After the next game, where MAHS suffers a season-ending humiliating defeat, an unknown student hits Stargirl in the face with a ripe tomato, to which the audience responds by applauding. The school takes out their anger for the defeat on Stargirl, illogically blaming her for the team’s loss. This eventually leads to her being shunned by the entire student body except for Leo and her one remaining friend, Dori Dilson.
After Stargirl’s popularity ends, she and Leo begin an obvious romance. Stargirl takes Leo to a place that seems like nowhere and they sit there for an hour and enjoy the beauty and "connect with the earth". A few days after this, they kiss on the sidewalk in front of her house, and Leo declares that it was "no saint I was kissing," They enjoy each other's company, and Leo begins to help Stargirl with her antics, such as leaving cards for people she doesn't know, and dropping change on the sidewalk. It is by observing her behavior that he figures out that Stargirl was the mysterious person that gave him the porcupine necktie four years before. Soon, though, Leo realizes the entire school is shunning the couple. Wanting to help her, he asks Stargirl to change and become "normal", so she becomes "Susan", the name she was born with. She drops her unconventional clothing and acts like all the other students at the school. She becomes obsessed with being "accepted" and popular. This plan, however, fails, and their classmates continue the shunning, despite Stargirl's valiant efforts to become a normal girl.
"Susan" feels that the best way to become popular is by winning a state public speaking competition. Her eccentric and creative personality helps her achieve victory in the competition, and she returns to MAHS thinking she will receive a hero’s welcome. She is bitterly disappointed when only three people show up to see her homecoming. Susan realizes that she had achieved nothing by trying to fit in. She decides to go back to being her true self, and Stargirl returns, much to Leo’s dismay. He then abandons his relationship with Stargirl, confused about his feelings for her and with his desperation to be accepted by the school.
When the Ocotillo ball comes Leo decides not to go. Leo watches the ball from his bike in the distance. Stargirl regains popularity as she arrives on a bike covered in sunflowers. Stargirl is dressed beautifully and impresses everyone as she walks onto the tennis court. As the dance progresses, Stargirl causes conflict with Hillari Kimble. When Stargirl asks the DJ to play the "Bunny Hop", Hillari is appalled. Stargirl starts the dance with only a few people participating, until eventually the only people not in line are Hillari Kimble and Wayne Parr. Stargirl leads the hop into the desert where it seems as though they stay for hours. Upon the dancers' return, Hillari confronts Stargirl telling her that she always ruins everything and slaps her on the face. Stargirl returns Hillari's anger-filled action with, yet another, act of kindness - a polite kiss on the cheek. The next day, Stargirl disappears...Later on in the story Archie tells Leo that Stargirl moved away.
Fifteen years after graduating high school, Leo finds himself working not as a television director, but a set designer. Stargirl has left behind some permanent changes at Mica Area High School: students cheer the first basket scored against them at every game, a club called "The Sunflowers" performs one nice act per day for someone else, and the school’s marching band is the only one in Arizona to feature a ukulele. The story ends with Leo receiving a porcupine necktie in the mail one day before his birthday and realizing Stargirl had given it to him, his hope for Stargirl continues.