Mother Courage and Her Children opens in Dalarna, spring 1624, in the midst of the Thirty Years War. A Sergeant and Recruiting Officer are seeking soldiers for the Swedish campaign in Poland. A canteen wagon appears, bearing the infamous Mother Courage, her silent daughter, Kattrin, and her sons, Eilif and Swiss Cheese.

The Recruiting Officer attempts to lure Eilif into the army. Courage demands that he leave her children alone. The Sergeant protests and asks why, since Courage lives off the war, it should not ask something of her in return. When Eilif admits that he would like to sign up, Courage foretells the fate of her children: Eilif will die for his bravery, Swiss Cheese for his honesty, and Kattrin for her kindness. Courage readies to leave. The Recruiting Officer presses the Sergeant to stop them. While the Sergeant feigns to buy one of Courage's belts, the Recruiting Officer takes Eilif away.

In 1626, Courage appears beside the tent of the Swedish Commander, arguing with the Cook over the sale of a capon. The Commander, a Chaplain, and Eilif enter the tent, the Commander lauding his brave soldier for raiding the local peasants. Courage remarks that trouble must be afoot. If the campaign was any good, he would not need brave soldiers. Courage reunites with her son.

Three years later, Courage and Kattrin appear folding washing on a cannon with Swiss Cheese, now a paymaster, and Yvette Pottier, the camp prostitute, look on. Yvette recounts the story of her lost beau, Peter Piper.

The Chaplain and Cook appear and they talk about politics. The Cook remarks ironically that their king is lucky to have his campaign justified by God: otherwise, he could be accused of seeking profit alone. Suddenly cannons explode; the Catholics have launched a surprise attack. The Cook departs for the Commander. Swiss arrives and hides his regiment's cash box in the wagon.

Three days later, the remaining characters sit eating anxiously. When Courage and the Chaplain go to town, Swiss departs to return the cash box unaware that an enemies are lurking about to arrest him. When Courage and the Chaplain return, two men bring in Swiss. Mother and son pretend to not know each other.

That evening, Kattrin and the Chaplain appear rinsing glasses. An excited Courage enters, declaring that they can buy Swiss' freedom. Yvette has picked up an old Colonel who will buy the canteen; Courage only plans to pawn and reclaim it after two weeks with the money from the cash box. Thanking God for corruption, Courage sends Yvette to bribe One Eye with the 200 guilders.

Yvette reports that the enemy has agreed. Swiss, however, has thrown the cash box into the river. Courage hesitates, thinking that she will not be able to reclaim the wagon. Courage proposes a new offer, 120 guilders. Yvette returns, saying that they rejected it, and Swiss' execution is imminent. Drums roll in the distance. Two men enter with a stretcher, asking Courage if she can identify Swiss Cheese's body. Courage shakes her head, consigning the body to the carrion pit.

Courage then appears outside an officer's tent, planning to file a complaint over the destruction of her merchandise. A Young Soldier enters, threatening the captain's murder. Apparently he has stolen his reward for rescuing the Colonel's horse. Courage tells him to quiet down, since his rage will not last. Defeated, the soldier leaves, and Courage follows.

Two years pass, and the wagon stands in a war-ravaged village. The Chaplain staggers in; there is another wounded family of peasants in the farmhouse. He needs linen. Courage refuses, as she will not sacrifice her officers' shirts. The Chaplain lifts her off the wagon and takes the shirts.

The canteen sits before the funeral of Commander Tilly in 1632. Mother Courage and Kattrin take inventory inside the canteen tent. Courage asks the Chaplain if the war will end—she needs to know if she should buy more supplies. The Chaplain responds that war always finds a way. Courage resolves to buy new supplies, and sends Kattrin to town. Kattrin returns with a wound across her eye and forehead, as she was attacked en route. Counting the scattered merchandise, Courage curses the war. Immediately afterward she appears at the height of prosperity, dragging her new wares along a highway. She celebrates war as her breadwinner.

A year later, voices announce that peace has been declared. Suddenly the Cook arrives, bedraggled and penniless. Courage and Cook flirt as they recount their respective ruin. The Chaplain emerges, and the men begin to argue, fighting for the feedbag. When Courage defends the Cook, the Chaplain calls her a "hyena of the battlefield." Courage suggests they part company. Suddenly an older, fatter, and heavily powdered Yvette enters. The widow of a colonel, she has come to visit Courage. When she sees the Cook, she unmasks him as the Peter Piper that ruined her years ago. Courage calms her and takes her to town.

Both men are now convinced that they are lost. Eilif then enters in fetters. He faces execution for another of his raids and has come to see his mother for the last time. The soldiers take him away and cannons thunder. Courage appears, breathless. The war resumed three days ago and they must flee with the wagon. She invites the Cook to join her, hoping that she will see Eilif soon.

It is autumn of 1634. A hard winter has come early. Courage and the Cook appear in rags before a parsonage. Abruptly the Cook tells her that he has received a letter from Utrecht saying that his mother has died and left him the family inn. He invites her to join him there. However, they must leave Kattrin behind. Kattrin overhears their conversation.

Calling to the parsonage, the Cook then sings "The Song of the Great Souls of the Earth" for food. It recounts how the great souls meet their dark fates on account of their respective virtues—wisdom, bravery, honesty, and kindness. Courage decides she cannot leave her daughter. Kattrin climbs out of the wagon, planning to flee, but Courage stops her. They depart.

It is January 1636 and the wagon stands near a farmhouse outside Halle. Kattrin is inside; her mother has gone to town to buy supplies. Out of the woods come a Catholic Lieutenant and three soldiers, seeking a guide to the town. The Catholic regiment readies for a surprise attack. Convinced there is nothing they can do, the peasants begin to pray. Quietly Kattrin climbs on the roof and begins to beat a drum. The soldiers shoot Kattrin. Her final drumbeats mingle with the thunder of a cannon. She has saved the town.

Toward morning, Courage sits by Kattrin's body in front of the wagon. Courage sings Kattrin a lullaby. The peasants bring her to her senses and offer to bury her daughter. Courage pays them and harnesses herself to the wagon. "I must get back into business" she resolves and moves after the regiment.