James lives with Mark, a drunken, dissolute wreck, in a beautiful house in Italy. After yet another destructive binge with local youths, Mark confesses that he 'wants Daisy back'.  We rewind several years to make sense of this:

James, a physics student, finds himself swiftly disabused of his dreams of a perfect Oxford life when he arrives at Gloucester College. His studies are far harder than he imagined, and he struggles to find friendship among his fellow undergraduates. Meanwhile, he becomes aware of a glamorous set of students, and is fascinated by his glimpses into their lives.

After suffering a serious knee injury, James falls into a depression and begins to question whether Oxford is the place for him. He is saved by a chance meeting with Jess, a music student and a member of the glamorous set. Jess introduces James to her friends: Mark, a rich, flamboyant, gay theology student; beautiful Emmanuella, who has a string of Scandinavian boyfriends; and Franny and Simon, politics students in a casual relationship.

James is inducted into the set, and moves into Mark's enormous house where he settles into a relationship with Jess. When Mark's mother visits, he realises that the flamboyance hides an inner pain caused by lifelong clashes with his domineering mother.

During the long vacation the group visit Simon's family. In a disturbing accident, Simon's young brother nearly drowns; he is saved by Mark. Mark and James grow closer over the following year, although tensions emerge as Mark begins to finance James's university life. Their friendship is challenged when Mark comes on to James, who initially rejects him. But as they are about to leave Oxford, James accepts Mark's advances, only for Mark to declare that he was just testing his friend.

After university, the friends drift apart. James moves in with Jess and studies to become a teacher. Nobody hears from Mark until suddenly he announces that he is planning to marry Nicola, Simon's devout and underage sister. Mark's friends are concerned that he is denying his homosexuality, but the wedding goes ahead. Soon afterwards James realises that he is in love with Mark, and they begin an affair.

Nicola becomes pregnant, and they have a daughter, Daisy. Mark dotes on Daisy, even as his marriage begins to disintegrate. Mark is on the point of confessing to Nicola about his affair with James when a tragic accident occurs. Whilst driving late one night, Mark crashes his car and Daisy, still a toddler, is killed.

In the aftermath of Daisy's death, Mark and James's relationship comes to light. Jess reveals that she already knew they were having an affair. James moves out and agrees to live with Mark to help him cope with his grief. After moving around restlessly for a while, the two men settle into an unhappy existence in an Italian villa near San Ceterino. Mark has become physically abusive towards James. After a particularly violent outburst, James moves into a hotel in the town.

While wandering around San Ceterino, James spots Jess with her new boyfriend, on a tour with their orchestra. James and Jess talk for the first time since he left her for Mark. After their talk, James finds the strength to go back to the villa and tell Mark that their relationship is over.