The police investigate a freight elevator with two brutally slaughter individuals inside.
Fur coat manufacturer Jake Feldman threatens his workers with termination if they don't shape up. His foreman, Lou Chinaski, tells Jake that they have an important meeting, but his boss tells him to deal with it himself and goes to the local strip club. Jake pays for a private section and meets with his favorite stripper, Shanna. She starts to dance for him and reminds him repeatedly not to touch, per the club rules. Jake finally grabs her and she fight backs, knocking him away. Shanna fends him off with a chair and Lake goes, but insists that one day she'll give it to him.
In the New Jersey woods, Jeb "Pa" Jameson and his son Larry go hunting for raccoons. They slip through a barbed-wire fence belonging to Mother Mayter, and Pa explains that he was there earlier placing his traps. Larry worries that they're trespassing but Pa dismisses his concerns. They enter the ruins of an old city and find raccoons caught in all the traps that Pa set earlier. As they check the traps, Larry notices that the ruins are inscribed with drawings of raccoons. Pa tells his son to kill his first raccoon and explains that the best way is to step on their neck and break it. He hands Larry a baseball bat and says that then you have to bash in their skulls to finish the job, and sometimes it takes as many as fifty blows to kill one. As they work, Larry finds one trap with a severed paw in it, and Pa explains that sometimes a raccoon is so desperate that it will gnaw its own paw off. As they go, Pa boasts that the raccoon pelts are the best that he's ever seen and they'll make a fortune. They pass Mother Mayter's cabin and notice her watching them.
Once they return home, Pa and Larry skin the raccoons and Pa points out that all of the pelts are identical, as if they came from the same family. Larry admires the pelts and says that he gets a warm feeling from them, and Pa admits he's getting a warm feeling from all the money they'll make selling the pelts. Pa goes upstairs to drink and tells Larry to finish up.
Jake is at the strip club watching Shanna dance and flirt with a female customer, Mira. He receives a call from Pa, who says that he wants ten times the normal price for the new batch of pelts. Jake doesn't believe him but Pa insists that Jake will make a fortune to buy whatever he wants. Jake glances up at Shanna and tells Pa that he'd better not being joking, and Pa insists that he has the perfect pelts. Shanna leads Mira away and a disgusted Jake agrees to travel to see the pelts.
In the workshop, the pelts entrance Larry, who strokes them and admires how beautiful they are. He then picks up the baseball bat, goes to Pa's room, and pokes him awake. When Pa wonders what he's doing, Larry beats his skull in, swinging over and over again and talking about how sometimes it can take fifty blows to kill someone.
Jake and Lou arrive at the Jameson house the next morning and discover that the door is unlocked. They go to the workshop and find the pelts, and Jake realizes that Pa was telling the truth. They hear something in the cellar and go to investigate. They discover Larry's corpse, his face severed from the rest of the head. After killing his father, the enraptured Larry went to the cellar, put his head in a raccoon trap, and triggered it, cutting off his own face. Jake goes upstairs and finds Pa's fly-covered corpse. Lou wonders what they should do and Jake insists on taking the pelts and making them into a coat for an upcoming fur exhibition. He assures Lou that once they leave, they'll call the police anonymously and repeat the two deaths.
Back at his factory, Jake orders his workers to unload the furs from his cars. The Asian workers refuse to touch them and walk away. Lou reminds Jake that they'll need the perfect model to show off their perfect coat, and Jake tells him that he knows exactly who they'll use. He goes to the strip club where Shanna is having sex with Mira in her dressing room. She reluctantly sees Jake when he promises big money, and he tells her that he wants her as the model for his fur coat. Desperate for a legitimate gig, Shanna agrees to consider the idea.
Jake's employee Sergio starts cutting the pelts. When Jake spots him miscutting the fur, he grabs the shears and does it himself. That night, Sergio goes to his car to drink. Smiling mindlessly, he takes out his shears and cuts open his own stomach, pulling out his intestines.
Once the pelts are cut, Jake's Asian workers reluctantly sew them into a coat. Meanwhile, Lou gets an idea and suggests that they should get a breeding pair to produce more coats. Jake drives back to the now-deserted Jameson house and finds a map of the area that Pa drew. Grabbing a bottle of Pa's moonshine, Jake goes to the ruins and approaches Mother Mayter's house. He offers her the bottle in return for the answers to his questions. She invites him in and explains that the "pine lights" in the forest are the sentinels of the lost city. Since they've came, Mother Mayter fenced off the ruins on her land and warned everyone away. Jake gets her to explain that the pine lights are the raccoons, and then notices that they are at the windows, staring in at him. When he asks for a couple of the raccoons, Mother Mayter accuses him of getting the Jamesons killed because of his vanity. He runs off while she screams at Jake that the raccoons aren't finished with him.
When Jake returns to his shop, Lou informs him that one of the workers, Sue Chin Yao, has suffocated to death. She was stitching together the pelts, alone, and sewed together her mouth, eyes, and nose. Jake tells Lou to keep the death quiet to avoid the bad publicity. Lou wonders if the coat is cursed, but Jake grabs the coat, strokes it lovingly, and then leaves with it. He goes to Shanna's apartment and shows her the coat through the peephole. Entranced, she lets him in and Jake puts it on her. However, he tells her that she isn't the only model interested in wearing the coat and that he'll have to see how they audition. Shanna strips off her clothing but keeps the coat on, and tells him that she'll audition for Jake then and there. He takes her from behind, all but raping her, and rubs his face on the fur coat. Once he's done, he mutters about needing to find something sharp. When Shanna wonders what he means, Jake says that he needs to fresh himself up and goes to the bathroom.
As Jake passes through the kitchen, he picks up a large knife that catches his eye. In the bathroom, he takes off his shirt and polishes the knife, and then begins skinning himself. When he's done, he goes back to Shanna, holding out the blood-covered skin vest. Jake calls it a work of art and tells the horrified Shanna that he made it just for her. Screaming, she runs out of the apartment to the freight elevator of her apartment building. Jake staggers after her and gets to the elevator just as it descends. As it gets to the bottom, Jake jumps down the shaft and falls through the top of the elevator. Shanna tries to get out but Jake grabs her leg. She hits the elevator button and the freight door closes on her hand, severing it.
Later, Lou arrives to check on his boss. The police are investigating the crime scene. Jake has bled to death while Shanna has died of shock and blood loss... her hand caught in the elevator door like a wounded animal's paw in a trap.