John and Laura Baxter are enjoying a Sunday afternoon before they go to Venice, where John is restoring a church. Their peace is interrupted when their daughter, Christine, falls into a pond and dies, despite her father's attempts to rescue her.
Attempting to recover from their grief, the couple go to Venice where John begins work. During a meal, Laura meets two English sisters, Heather and Wendy. Heather, who is blind and claims to be a psychic, tells Laura that she can see Christine standing happily between her parents at the table. Laura faints but recovers at a hospital where she tells John that Christine is still with them. John is sceptical but Laura insists on going to a church and lighting six candles.
Back at the hotel they make love and get changed. Searching for a favourite restaurant, they get lost among the alleyways and John sees a small figure, running through the streets, wearing the same red coat that Christine was wearing when she died. The next day, Laura meets the sisters and goes to their apartment for a séance. Heather warns Laura that John is in grave danger as long as he remains in Venice. Trying to stop the seance, John is mistaken for a peeping tom. After the seance, John is angered at talk about Christine, insisting that she is dead.
That night, a phone call is received from the school of John and Christine's son, Johnny, in England. Johnny has had an accident during fire practice. Terrified of losing another child, Laura insists on flying home. John remains in Venice. After she leaves, he goes to the church. Wishing to compare some replacement mosaic tiles with the original high on the wall, he is nearly killed in a fall.
Returning to his hotel, John is delayed by the police, who are lifting a horribly mutilated corpse out of the water, another in a series of murders plaguing the city. John is then baffled when he sees his wife, flanked by the two sisters, standing on a passing funeral barge. His calls to her are ignored and the boat vanishes. Disturbed by this sighting, he contacts the police. They produce drawings of the sisters and John gives the sceptical Inspector Longhi a picture of his wife. Longhi questions John, indicating that he disbelieves the story about the sisters, hinting that John may be involved in the serial murders they are investigating. When John leaves, the Inspector has him followed.
John decides that the police are going to do nothing and begins his own search. He cannot find the sisters, who have moved to another guest house after hearing reports of the peeping tom, but the police find them and arrest Heather. However, John has received a phone call from Laura in England and realises his mistake. He arranges to meet her for a meal that night. Returning to the police station, he collects a distressed Heather and takes her home.
After he leaves to meet Laura, Heather has a sudden psychic episode and screams that he is in danger. Wendy cannot catch up with John but meets Laura outside the hotel. Heather's warning prompts Laura to chase John.
John's attention has been diverted by another sighting of the red coated figure running amongst the alleyways. Believing that she is running away from the killer, he gives chase in the hope of protecting her. The figure runs inside a ruined building, followed by John who locks the gate so that killer cannot enter. In his mind, the short figure is synonymous with the image of the daughter he could not save. When he approaches the figure, it turns around and is revealed as a female dwarf, holding a meat cleaver and shaking her head. She buries the weapon in his neck and John dies. Laura, locked outside the gate, can do nothing except watch his feet kick out a pane of glass in his dying spasms.
Some time later, Laura, smiling and accompanied by Johnny and the sisters, sails on a barge to John's funeral.
