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The setting of Irving's fictional sketch is New England, a few miles from Boston, Massachusetts, in the early nineteenth century, a historical area settled by Quakers and Puritans where religious piety and fanaticism are prevalent among the citizens. It is around the year 1727, and much of the narrative takes place in a forest primeval, much like Nathaniel Hawthorne's The Scarlet Letter.
Tom Walker, the main character, heads home by taking a shortcut through a swamp filled with quagmires and pits. As he struggles along, Tom becomes exhausted and sits upon a fallen hemlock trunk where he espies the skull of an Indian with a tomahawk buried in it when a strange figure appears before him, neither "Negro nor Indian" and "begrimed with soot" with "great red eyes." This odd figure is known as Old Scratch, and it is with him that Tom Walker deals.
After Tom strikes his bargain with the devil and his wife dies, he moves to Boston where he becomes "a violent churchgoer" because in his old age he worries about the deal he has made with the devil in the swamp.
The good people of Boston shook their heads and shrugged their shoulders, but had been so much accustomed to witches and goblins and tricks of the Devil...that they were not so..horror struck....
There in Boston, Tom comes to his end.
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