The opera's story is based on three stories of E. T. A. Hoffmann, and partly on Hoffmann's own life.
In the prologue, the poet Hoffmann and his friend Nicklausse are drinking with a crowd of students. Hoffmann is very somber, and the crowd believes him in love, which he denies. But his mistress Stella is singing in the opera house next door. The councilor Lindorf sees Hoffmann as a drunkard. While they wait, Hoffmann tells the story of the three women whom he has loved.
Act I tells the story of Hoffmann's love for Olympia, who turned out to be a mechanical doll, the creation of the evil Dr Coppelius. (This same story forms the basis of the ballet Coppélia by Léo Delibes.) Hoffmann has seen her through magic spectacles.
Act II is the barcarolle act, which music occurs throughout the act. As the act opens, we see Hoffmann and Nicklausse at a party in a house in Venice given by the courtesan Gianetta. Also at the party are Schlemil, Gianetta's lover, who has been away; Schlemiel's friend Pitichinaccio, and Dapertutto. At the beginning of the act Gianetta and Nicklausse sing the barcarolle as a duet, with the other guests at the party forming the chorus. The story concerns the scheme of Dapertutto to get Hoffmann to fall in love with Gianetta. Hoffmann says he is not interested in a courtesan, but she leads him on, and eventually he does. Schlemil and Hoffmann fight a duel, in which Schlemiel is killed. But then Gianetta goes off with Pitichinaccio, and Nicklausse ushers Hoffmann off before he is arrested for murder, while Gianetta and Dapertutto laugh.
Act III concerns Hoffmann's love of the young innocent, Antonia, who suffers from consumption, and is forbidden to sing. The evil genius, Dr Miracle, persuades her to sing, and she is overcome with exhaustion, and falls dead.
In the Epilogue, Hoffmann and Nicklausse are back in the tavern, and Nicklausse deduces that all three loves are in fact Stella. But then Hoffmann then drinks himself into a stupor. Finally Stella arrives, and then leaves with Lindorf.