Noroi the Curse focuses of Masafumi Kobayashi, who makes documentaries from his investigations into the supernatural. However, the film reveals that after completing work on his latest project, "The Curse", he disappeared and his house burned down, his wife Keiko found dead in the ruins. The documentary is labelled as being too scary for public eyes, and the idea is that the audience is privately viewing it.
In 2003, Kobayashi and his camerman Miyajima visit a woman and her daughter who claim to hear strange noises coming from next door. The duo investigate, encountering the disturbing Junko Ishi, spotting her unnamed prepubscent son watching them from a window. They take a recording of the strange noises to an analyst who identifies them as multiple crying babies, despite Junko's neighbor claiming to have never seen any trace of an infant on Junko or her home. Just days later, Kobayashi learns that Junko has moved out of her house and the noises have stopped. He and Miyajima find dead pigeons scattered around Junko's abandoned house. Days after that, Junko's neighbour and her daughter die in a car crash, the mother having driven into oncoming traffic.
The film then splits into several subplots which all link to one another. On a Japanese Variety Show, ten children who have displayed Psychic Powers are put to the test to see who has the strongest abilities. Only one, a girl named Kana Yano, shows true talent, summoning water into a flask which has some kind of hair in it. The water is from a lake, and the hair from a newborn baby. Kobayashi visits the Yano family, learning Kana has become tired and depressed following the show, and her powers are erratic, launching an entire dinner set off a table. Not long after, Kana disappears. Her parents point Kobayashi to the peculiar medium Mitsuo Hori, a fidgety Cloudcuckoolander, who wears a tinfoil hat and coat, lives in a tinfoil-coated home, and claims that ectoplasmic worms took Kana. He freaks out when Kobayashi visits him, but is able to draw a crude map of a blue-coloured apartment block, hinting that is where Kana is, and asks what something called "Kagutaba" is, apparently hearing it with his ESP. The camera Miyajima is using to record these events experiences a strange glitch wherein the visual portion of the footage obtained during Hori's Freak Out is replaced with a still image of with a large number of crude masks. Kobayashi and Miyajima find the apartment, and watch as the owner, Osawa, takes pigeons inside, moving in an oddly calm manner. Like Kana, he disappears.
Meanwhile, Marika Matsumoto - who claims to have ESP - goes ghost hunting with two comedians to a remote shrine that is rumored to be haunted to get footage for a tv program, but the trip is cut short when she experiences a bizarre episode - she claims to hear voices, getting increasingly nervous due to a bad feeling, and finally screams wildly and falls to the ground while looking at an empty spot off in the distance. Marika begins sleepwalking as a result, drawing bizarre looping imagery. Kobayashi records her sleepwalking, discovering she has made a looping noose from an electrical cord. Loud noises can be heard in the footage, actually coming from the next floor, but Marika's neighbour Midori denies hearing anything. An unheard voice is also detected and speaks "Kagutaba". Finding a link between Kana's disappearance and Marika's behaviour, Kobayashi researches the phrase. Marika admits the voice sounds like one she heard at the shrine. It is also revealed that the 'empty spot' Marika was looking at was actually manipulated via film editing techniques to look empty - in truth, the camera that was recording Marika and the two comedians saw a bizarre quasi-human semi-translucent figure standing there.
He meets an historian, who explains that Kagutaba is actually a demon - though he suspect that 'demon' was just a convenient term for the villagers to use to describe an entity they did not understand the nature of - who was summoned by a community of sorcerers in a village called Shimokage, demolished in 1978 to make room for a dam. Kagutaba was summoned to bring disaster upon the village's enemies, acting as a sort of spiritual assassin, but turned against the villagers. The village then punished the demon by trapping him underground, and annually perform a ritual to pacify Kagutaba, or he could possibly escape. Kobayashi then visits a cultural archivist, Tanimura, who shows Kobayashi the filmed footage of Shimokage's last performed ritual before the village was destroyed. The ritual is shown, Kagutaba depicted as a red demon with a deformed Nightmare Face, seen throughout the film. However, the ritual goes wrong when the priest's daughter, dressed as the demon - falls to the ground screaming, just like Mariko did earlier in the film - possessed by Kagutaba. Troublingly, this happens in spite of the ritual being performed correctly, leaving us with no explanation as to how Kagutaba overcame it. Tanimura tells Kobayashi that the villagers of Shimokage all relocated to one specific neighborhood, and directs him to it. He also reveals that the woman who became possessed during the ritual is Junko Ishi.
Kobayashi investigates Junko's past. His attempts at getting information from the relocated villagers is met with dead end after dead end, as the inhabitants refuse to speak to him after he mentions Junko. One villager does speak to him, revealing Junko worked at a clinic that performed abortions - including illegal, late term abortions - helping to dispose of aborted foetuses, but was rumored to have stolen them. It is also noted that every home in this neighborhood has a pet dog, and a sickle near every door - which Tanimura mentioned was a traditional, superstitious way of keeping out evil spirits.
Marika informs Kobayashi that Midori committed suicide, hanging herself in a playground with several strangers using the same nooses she had been forging. Another one of the dead is noneother than Osawa. Kobayashi allows Marika to live with his wife. Midori and Osawa were implied to worship Kagutaba, and it is revealed that for a time, Junko lived next to Osawa, likely introducing the demon cult to him. In a news report, Kana's father is arrested for stabbing his wife. Oddly, he turned himself in, and seems to not know why he did it.
Marika begins showing signs of demonic possession whilst living at Kobayashi's house, and several pigeons kill themselves outside the house. Kobayashi decides to visit Junko again, going to Hori again, and shows him the footage of Junko, but he freaks out the moment she becomes visible in the video. Marika asks Kobayashi to take her to the dam so they can perform the ritual and pacify Kagutaba. Hori is convinced to come as well. They pass through Junko's neighborhood, noting it is quiet and all of the dogs are missing. They reach the dam, Kobayashi and Marika set out in a boat to the middle of the lake to perform the ritual. It is seemingly successful, as - after a brief fainting spell - Marika is apparently completely free of Kagutaba's influence. However, Hori starts freaking out again, claiming Kana is up the mountainside and runs off to look for her, pursued by Kobayashi. Miyajima and Marika wait in the car, but the latter starts showing possession again and flees into the woods, chased by Miyajima.
In the forest, Kobayashi and Hori discover the village dogs have been ritualistically mutilated, and a summoning circle has been formed around the old Shimokage shrine using wires and pigeon body parts. Kobayashi's camera cuts out and switches to night vision, revealing a ghostly Kana covered in undead baby foetuses, and wearing ceremonial robes, but the image vanishes when Kobayashi returns his camera to normal. Marika miraculously returns to normal, but she and the stunned Hori are rushed to hospital. Hori is committed to a mental health facility shortly after.
Kobayashi and Miyajima break into Junko's house to confront her, finding in it a ton of trash, various dead animals, and shrine to worshipping Kagutaba, complete with the collection of masks from the camera glitch earlier. Junko has hung herself. They find Kana's corpse, with Junko's unnamed son silently watching over her. Kobayashi sympathetically adopts the boy, believing he may not even be Junko's child, as there is no official record of his existence. Marika recovers from everything and returns to her acting career. Kobayashi revisits Tanimura, who finds a scroll in his grandfather's collection which describes how Kagutaba was originally summoned, involving the sacrifice of animals - including baby monkeys which the medium devoured - to call forth the demon. Kobayashi surmises that Junko was trying to replicate the ritual, kidnapping Kana and forcefeeding her aborted fetuses.
Kobayashi disappears two days later and his house burns down. Hori escapes the mental institute, but is found three days after the fire, cruelly mangled and shoved into a ventilation shaft. A month later, Miyajima receives a video camera from Kobayashi, revealing what happened on the night he disappeared. Hori was living at the Kobayashi household, and proclaimed that Kagutaba is still alive before attacking Junko's son with a rock. Kobayashi's camera briefly glimpsing the boy's face transformed into that of Kagutaba, implying the boy is acting as a host for the demon, or is the demon himself. Kana's ghost appears in a corner. Keiko and Hori are possessed by Kagutaba, Hori suddenly calming down and striking Kobayashi with a rock, before leaving with the boy. Keiko then sets herself on fire, regaining her senses just in time to suffer through a painful death while her husband watches, helpless.
The film ends with a message that Kobayashi and the boy are still missing.
