Scotland, 1879, and a group of monks travel across the land to the Torchwood estate. Their leader, Father Angelo, confronts the Steward and informs him that they want one thing: the house. When the Steward refuses to yield, Angelo easily subdues him and the other monks quickly subdue the manor staff using martial arts. They then enter the house and capture the staff and family. Everyone is placed in the cellar and the owner, Sir Robert MacLeish, watches with the others as Father Angelo brings in a cage. Some thing is inside, and the women scream as they see it.
The Doctor takes the TARDIS to 1979 but ends up arriving in 1879 instead. They emerge onto a Moor and find themselves confronting Scottish soldiers. Captain Reynolds holds them at gunpoint and demands to know why they are there. The Doctor passes himself off as a Scottish doctor and uses his psychic paper to "prove" his credentials. A woman in a nearby carriage tells Reynolds to bring the Doctor and Rose to her. The travelers find themselves face-to-face to Queen Victoria. She checks his psychic paper and informs him that he's been appointed as her Lord Protector. The Doctor plays along and Queen Victoria claims that she is traveling by road to avoid an assassination attempt. Reynolds suggests that they take shelter at MacLeish's home that night and continue in the morning. Queen Victoria agrees and notes of stories of wolves in the area. As they walk along, Rose bets the Doctor that she can get Queen Victoria to say "I am not amused."
As the Queen and her escort arrive at the Torchwood estate, Sir Robert watches from an upstairs window. He warns Father Angelo that he won't cooperate in treason, but Angelo informs him that if he doesn't help, Lady Isobel will be devoured. Sir Robert goes down, accompanied by the monks, dressed as staff. He claims that Isobel has left and took the cook with her, and tries to get the Queen to move on. Victoria notes that her husband Prince Albert often visited there and she's looking forward to seeing it. As the Queen goes inside, the soldiers take a small wooden box. Reynolds says that it's the property of the Crown and the Doctor should pay it no further attention.
In the cellar, the figure in the cage warns Isobel and the others to be quiet.
Reynolds places the box in cage and tells them to guard it with their lives.
Robert shows the Queen, the Doctor, and Rose to his father's observatory and explains he was obsessed with the stars. The Doctor is impressed and Robert admits that his father was eccentric. Victoria insists that Robert's father was an example to them all as an expert in both science and magic, and Prince Albert enjoyed his company. She notes that Prince Albert was intrigued by stories of the local wolf, and Sir Robert reluctantly starts to tell the story. Angelo interrupts to suggest they prepare to their rooms, and Sir Robert hastily agrees. Victoria demurs for the moment but insists that they'll talk about it over dinner, and that there is a full moon that night.
Later, Angelo's monks mix herbs and roots in the kitchen and then serve drinks to the Queen's guard. Meanwhile, Rose dresses for dinner and opens her wardrobe, and is startled to find a maid hiding in her wardrobe.
The guards collapse and the monks take their weapons.
The maid, Flora, tries to warn Rose that the estate has been invaded. Flora doesn't believe it but Rose promises that she'll be safe and takes her downstairs. They find the unconscious guards and the monks quickly subdue them and take them away along with the guards. Angelo tells the Doctor, Reynolds, and the Queen that Rose has been delayed. Victoria admits that she misses her husband, and that she is intrigued by the supernatural since his death. She then invites Robert to tell the story of the wolf.
In the cellar, the man in the cage, the Host, sits silent while Rose watches with the others. Isobel insists that the Host is nothing like them, and he opens his eyes to reveal they are almost solid black.
Sir Robert talks of how the wolf appears during the full moon, killing livestock and taking a child once every generation.
Rose approaches the cage containing the Host and demands answers, realizing that he's an alien. The Host says that he was once a boy, stolen by the monks ten years ago. And then an alien heart was placed in him.
Sir Robert explains that the wolf is man who transforms: a werewolf.
The alien inside the boy says that he is far from home, but isn't interested in returning. He plans to migrate to Queen Victoria, infecting her. It recognizes Rose as a kindred spirit of the wolf, but says it embraces the moon rather than the sun.
Robert explains that his father communed with the wolf to learn its purpose, but a local monastery opposed him. He believes that the monks turned from God and worshiped the wolf. The Doctor notices that Angelo has gone to the window and begins chanting.
The cellar door is thrown open and the Host looks up at the full moon. Rose and the others watch as he transforms, and she tells them to all pull on the chains holding them.
The Doctor and the others notice Angelo, and realize that his people have Rose. The Doctor runs off with Sir Robert to find her while Robert explains that the monks have his wife. Reynolds draws his gun and demands answers of Angelo, but the monk quickly subdues him.
Rose and the others pull free. They run up the cellar stairs just as the Doctor and Sir Robert arrive. The Doctor stops for a moment to admire the humanoid wolf and then helps get everyone out.
Father Angelo tells Victoria that they have waited for one of her journeys to coincide with the moon. She takes out a gun and shoots him.
The Doctor and the others barricade the cellar door and go to the kitchen, and Sir Robert tells Isobel to take the family and staff out. Rose tells the doctor what the Host said. They hear a noise in the hallway and the Doctor goes out to find the Wolf approaching. The Steward and his men open fire, driving it back, while Isobel discovers that the doors are locked and the monks are outside.
The Steward assumes the Wolf is dead and goes to investigate, and it quickly kills him. As the other men open fire, Isobel and the maids cower at the sounds. The Wolf enters their room, but then turns and leaves.
Queen Victoria goes to the box and removes it from the case. She finds Sir Robert, the Doctor, and Rose, and they explain what's happened. The Doctor determines that the doors have been boarded shut and they go to a window to climb out. Sir Robert insists on leading the way but the monks open fire, driving him back. Victoria doesn't believe Rose's explanation but realizes it's true when the Wolf starts breaking down the door. They run for the observatory and the Wolf closes in, but Reynolds arrives and shots it, momentarily delaying it. He tells the others to go on while he temporarily holds the Wolf at bay, sacrificing his life.
The group barricades the door to the library and hears the Wolf just outside. Surprisingly, it retreats, and the Doctor realizes that something in the room is repelling it. Sir Robert apologizes to his Queen, who demand answers and is unsatisfied with the Doctor's explanation.
In the kitchen, Isobel realizes that the monks are wearing mistletoe, and that the kitchen is filled with it. She has the staff gather up all the mistletoe she can.
The Doctor notices mistletoe in the library, and Sir Robert confirms that his father placed it there. Further, the oil has been worked into the woodwork. Sir Robert warns that the Wolf won't stop, but the Doctor insists that the answer lies within the books that Sir Robert's father gathered.
Isobel and the others prepare the mistletoe, and Isobel insists that she'll do whatever she can to save her husband.
The Doctor and the others go through the books and find a record of a shooting star dropping near the monastery in 1540. They figure that the Wolf has passed itself down in human hosts, down through the generations, and plans to create the Empire of the Wolf, bringing spaceships to Victorian England and ruling over the country. Queen Victoria insists on destroying herself rather than letting the Wolf infecting her, but asks Sir Robert to take a large diamond, the world-famous Koh-i-noor. She explains that she's taking it to the Royal Jewelers for a cutting, and that Albert always cut it and insisted the shine wasn't quite right. The Doctor realizes that it's all connected and that Sir Robert's father and Prince Albert set a trap for the Wolf. Before he can explain, the Wolf smashes through the skylight and they run out of the room. The Wolf comes after them and prepares to kill Rose, but Isobel and the staff arrive and throw buckets of mistletoe oil on it, driving it away.
Sir Robert sends his wife and the others on and then goes to the observatory with the Doctor, Rose, and Victoria. Sir Robert tells them to go on while he delays the Wolf, and the Doctor asks for the diamond to put it to the purpose it was intended for. She hands it over and they place it in the telescope.
Sir Robert takes a sword from the wall and confronts the Wolf, cutting at it as best to hold it off and regain his honor. Meanwhile, the Doctor explains that the telescope magnifies light as a weapon. They put it into position and the telescope focuses the light through the diamond, striking the Wolf as it bursts through the door. It is blasted into the air and the Host gains enough control to beg them to brighten the light and let him go. The Doctor increases the beam and the creature dissipates. Victoria examines a cut on her hand but she insists it was a splinter from the door, not a bite. When the Doctor asks to see it, she refuses.
The next day, the Queen titles the Doctor and Rose. When she is done, the Doctor suggests that Prince Albert sent her his protection from beyond the grave. She agrees, but then informs the pair that they are exiled for consorting with magic and the power of the stars.
As the Doctor and Rose are dropped off at the TARDIS, the Doctor notes that historically, Victoria suffered from a mutation of the blood, but she didn't inherit it. He wonders if it might have been passed on to her children, and will become strong enough by the early 20th century.
Back at the Torchwood Estate, Isobel says that she will sell the house and move on. However, Queen Victoria assures her that the events that occurred there will not be forgotten. Sir Robert's sacrifice will be remembered, and Victoria will create the Torchwood Institute in his name, to battle the strange and the supernatural. She vows that if the Doctor returns, he will have to face Torchwood as well.