The book opens with a description of Shane riding into town. The narrator Bob Starrett watches him with a child's fascination. He first notices Shane's clothing: dark pants, boots, a belt, coat, and hat. The clothing is predominantly black and retains "magnificence." As Shane approaches, Bob notices that his clothing pales in comparison with his affect and stature. Although Shane is a slender man, Bob observes "endurance" and "quiet power." The lines of Shane's face are hardened, suggesting a long and hard past. Bob is struck with the chills when looking at Shane.
Shane stops at the house and asks for some water for himself and his horse. Bob's father, Joe Starrett, invites him to take all he needs. Bob continues to observe the magnificence of the stranger. Bob's father talks Shane into staying overnight and letting his horse get some rest. Shane meets Bob's mother, Marian Starrett, and sits down to one of her home-cooked meals. Both Marian and Joe question Shane throughout dinner and he answers their questions without providing much information about himself. Bob notices the easy way Shane seems to fit in with the three of them. Soon they begin talking about Joe's plans for the farm, and Joe explains that Fletcher, a rancher in the area is trying to take over all the farms to use as his own cattle grounds.
After dinner Bob overhears his parents talking about Shane. His mother calls him "peculiar" and says she "never saw a man quite like him before." They talk about how mysterious it is and the fact that he would not reveal information about himself. Marian says he is dangerous, and Joe says he is not dangerous to them.
In the morning they all eat Marian's special flapjacks. It begins to rain, and Joe tells Shane that he cannot leave yet because of the weather. Joe suggests that Shane stay over once again, because even when it stops raining the roads will be a mess. Joe and Marian convince Shane to stay, and Marian asks him about ladies' fashion where he has traveled. After the storm, Joe takes Shane around the grounds of the farm. Shane notices the old big stump on the grounds, and Joe explains it has been the bane of his existence for years and that he's working on uprooting it bit by bit.
The town peddler comes while Shane and Joe are on the grounds. The peddler has a new cultivator for Joe and tries to overcharge him for it. Shane steps in, saying that he just recently saw a new cultivator for almost half as much as the peddler is asking. The peddler gets offended and angry with Shane, but Joe sides with Shane, telling the peddler that he believes Shane is right. The peddler ends up reducing his price.
Shane gets an ax from the barn and begins to work on the stump. Bob describes the sound as one of the most memorable of his entire life. Shane says something about needing to repay his debts and slices away at the stump. Joe gets the other ax and begins working with him, the two men swinging away at opposite sides of the stump.