Archibald Hunter, a young Englishman, is passing his leisure time near Cruden Bay in the small Scottish village of Whinnyfold when he has a vision of a couple walking past him, carrying a tiny coffin. Archibald also notices a strange old woman watching him. Later, he finds out that his vision has come true, and a child in town has died. Archibald encounters the bizarre old woman again on the seashore; this woman, who introduces herself as Gormala MacNeil, knows that Archibald saw something out of the ordinary. She proceeds to explain that she has "Second Sight"--a sort of psychic ability for premonition that comes and goes at random--and that she can tell that Archibald, too, is a Seer. Fluctuating between skepticism and uneasiness over his newfound abilities, Archibald listens to Gormala's insights and sees one of his visions fulfilled at Lammas-tide, when he and Gormala witness Lauchlane Macleod, a local fisherman, wreck his boat on a chain of sharp rocks known as the Skares. Archibald sees a procession of dead spirits emerge from the water near the Skares and make its way up the cliffs.

About a year later, Archibald has returned to Cruden Bay and is preparing a permanent residence there. He buys a trunk from an auctioneer on the street (where he again encounters Gormala) and finds that the trunk contains letters from the late 16th and early 17th centuries. While near the seashore, Archibald notices two ladies stranded on a rock out in the ocean. He helps them get back to shore, and learns that one of the ladies is an elderly woman named Mrs. Jack, and the other a young, beautiful woman named Marjory, an American who has a strong aversion to Spaniards. Archibald feels himself falling in love with Marjory instantly. Later, Marjory helps Archibald decode the letters that he found in the trunk, which are written in a complicated cipher (Bacon's cipher). Archibald soon proposes marriage to Marjory, but she declines with the excuse that she does not know him well enough.

Eventually, Archibald deciphers all of the documents in the trunk and finds that it is a narrative written by a Spaniard named Don Bernardino de Escoban. Don Bernardino was given a trust by Pope Sixtus V in the late sixteenth century, which included the charge of a substantial treasure to use against England after the defeat of the Spanish Armada. The duty to protect this treasure was to be passed down through generations of Don Bernardino's family, but Don Bernardino lost the treasure after hiding it in a seaside cave. Conveniently, Archibald realizes that, based on the documents, the most likely location of this cave is directly under the house he is currently building.