The whiskey priest is contrasted with another priest, Father Jose, who has capitulated to the demands of the new regime, has married and left behind the service of the Church:

“Jose,. Come to bed.” He shivered: he knew he was a buffoon… He stood outside himself and wondered whether he was even fit for hell. He was just a fat old impotent man mocked and taunted between the sheets. But then he remembered the gift he had been given which nobody could take away. That was what made him worthy of damnation—the power he still had of turning the wafer into the flesh and blood of God. He was a sacrilege. Wherever he went, whatever he did, he defiled God.

The whiskey priest, like Father Jose, feels like his life is a living affront to God and His Church. Yet, at the same time, he is set apart from Father Jose. There is something unique about the pitiful drunk whiskey priest. The narrative of the novel follows the priest as he moves secretly from place to place, trying to stay ahead of the band of state policemen who have put out a warrant for his arrest. He stops in one village where he used to minister before the persecution and meets a woman he had once had an affair with, and the illegitimate child who was born from this union. While there, the people beg the priest to administer the holy sacrament to them, something he knows could get him martyred if he were caught. And indeed, while the service is underway, he receives news that a band of policemen, led by an atheistic lieutenant, has surrounded the village. The villagers, however, refuse to give up the priest, and consequently the lieutenant takes hostage two of their number. The priest, the supposed shepherd of his scattered flock, feels an incredible sense of guilt over his cowardice and leaves the village.

During his exodus, he attracts the attention of a character known only as the mestizo (half-blood). While riding away from a town on a mule, the priest hears the mestizo calling out for him, claiming that he wants to accompany the priest to the next village. The mestizo is a shifty and calculating figure who begins trying to get the priest to admit to his illegal vocation (knowing that there is a substantial reward if he turns him in). The priest is alarmed when the mestizo begins to claim that he knows the priest’s true identity. When they stop to sleep, the priest tries vainly to stay awake, lest the Judas betray him (something he is not willing to let happen), but eventually hears the mestizo crying out in a fevered condition about the state of his soul. The priest knows what he must do—what his calling demands of him. So he puts the Betrayer on his mule and sends him into town for medical attention (though the priest is still unwilling to give himself up).

The climax of the novel begins when the mestizo appears again to the priest, who had fled to sanctuary in a less-hostile part of the country. The mestizo tells the priest that a Yankee outlaw, known only as the Gringo, is dying and has requested that a priest administer the final rites to him. The priest reluctantly agrees, knowing that the mestizo means only to entrap him and turn him over to the authorities. When the priest arrives, he finds the outlaw resistant to his ministrations, and angry that the priest has allowed himself to fall into such an obvious trap. Realizing that the outlaw does not really want absolution, In a foreshadowing, the priest reflects on how “there was a legend believed by many criminals that dead eyes held the picture of what they had last seen—a Christian could believe that the soul did the same, held absolution and peace at the final moment, after a lifetime of the most hideous crime.”

The outlaw tries to convince the priest to take one his weapons in order to defend himself against the police who will surely come for him shortly:

“Father,” the voice said urgently, “you let me be. You look after yourself. You take my knife…” The hand began its weary march again—this time towards the hip. The knees crooked up in an attempt to roll over, and then the whole body gave up the effort, the ghost, everything.

The priest hurriedly whispered the words of conditional absolution, in case, for one second before it crossed the border, the spirit had repented, but ir was more likely that it had gone over still seeking its knife, bent on vicarious violence. He prayed: “O merciful God, after all he was thinking of me, it was for my sake…” but he prayed without conviction. At the best, it was only one criminal trying to aid the escape of another—whichever way you looked, there wasn’t much merit in either of them.

The lieutenant, it turns out, had been watching this interaction the whole time, but had allowed the priest to finish before arresting him, explaining, “I am not a barbarian.” He then conducts an interview with the priest, charging that his Church has oppressed the poor and proved ultimately cowardly by not standing up to the oppressive Mexican government. The priest agrees with all the lieutenant’s charges, and admits that he himself is the chief sinner of all on account of his pride and drunkenness and immorality.

The lieutenant said in a tone of fury, “Well, you’re going to be a martyr—you’ve got that satisfaction.”

“Oh no. Martyrs are not like me. They don’t think all the time—if I had drunk more brandy I shouldn’t be so afraid.”

The next morning, the priest is brought to the place of execution, feeling “only an immense disappointment because he had to go to God empty-handed.” At the very end, he thinks how easy it might have been to be a saint, if only he had exercised a little more self-restraint and courage. But now, even if he failed to be a saint in life, he might be one in death.

The novel closes as a mother tells her son the story of a earlier martyr of the Mexican church, Father Juan, who was brought before a firing squad, just like the whiskey priest: “raising both arms above his head, [Father Juan] called out in a strong brave voice to the soldiers and the leveled rifles, ‘Hail, Christ the King.’” The boy asks his mother if the whiskey priest, who also had been brought before a firing squad that morning, was a hero like Father Juan. “Yes,” the mother says, “he was one of the martyrs of the Church…. He may be one of the saints.” That night, the boy has a dream in which the whiskey priest appears in a coffin and winks at him. The picture of the winking eyes recalls the criminals’ legend of how dead eyes hold a picture of what they saw last. The flickering eyes, the wink of corpse, hints that the boy is being let in on a private joke which only he and the priest share. The secret is revealed on the last pages:

[The boy] woke and there was a crack, crack on the knocker on the outer door…. He unlocked the heavy iron door and swung it open. A stranger stood in the street, a tall pale thin man with a rather sour mouth….

“If you would let me come in,” the man said with an odd frightened smile, and suddenly lowering his voice he said to the boy, “I am a priest.”

“You?” the boy exclaimed.

“Yes,” he said gently. “My name is Father—“ But the boy had already swung the door open and put his lips to his hand before the other could himself a name.