O'Casey's The Shadow of a Gunman takes place in Dublin in 1920, during the Irish War of Independence.

The action occurs in a single day and night in a tenement flat shared by two men, Donal Davoren and Seumas Shields. Both are adherents of the Republican cause that seeks independence from Britain. Davoren is apparently an IRA operative, but it is unclear what his activities are; at a crucial moment when alone, he describes himself as the eponymous shadow of a gunman. At least during the one day of the drama, both he and Seumas appear to spend most of their time philosophizing and quoting poetry rather than doing anything constructive, despite their Republican sympathies.

A young girl who lives in the same building, Minnie Powell, is attracted to Davoren and visits him in the flat. This occurs after another man, a friend of Seumas named Maguire, has dropped off a bag and then immediately rushed out, saying that he is going out "to catch butterflies."

Minnie and others look up to Davoren because of his reputation as a member of the independence movement. While Minnie is visiting him, two other tenants, Mr. Gallogher and Mrs. Henderson, present Davoren with a letter addressed to the "Gentlemen of the Irish Republican Army" and asking for help against residents of the tenement who are disruptive and are threatening people. Davoren accepts the letter. But during this scene the news is received that an ambush has occurred in which a man named Maguire has been killed. When the others ask Davoren if he knew Maguire, he first answers yes, then quickly denies it. After the others have left, Minnie asks Davoren to type her name on a sheet of paper for her; he does so, then types his own name below it. She leaves, and when Davoren is alone he muses over her attraction to him because of her belief that he's a "gunman on the run," but then tells himself that there is no actual danger in merely being the shadow of such a gunman.

Later, in the middle of the night when Davoren and Seumas are awake in the room, a disturbance is heard down the street, and it becomes evident that British soldiers are raiding the area in search of Republican sympathizers. Both men are fearful, and they discover that the bag Maguire left in their flat contains bombs. Minnie comes in and tells them the building is surrounded, and she takes the bag, saying that because she is a woman the soldiers won't harm her, while if it's found with the men, they're sure to be arrested. After Minnie is gone, soldiers burst into the room and make threats, but they leave Davoren and Seumas undisturbed. Another neighbor, Mrs. Grigson, enters and tells Davoren and Seumas that Minnie has been arrested, having been found in possession of the bombs. The military truck on which Minnie is being held is then ambushed, and when Minnie jumps off the truck in an attempt to escape, she is shot dead. Davoren and Seumas, when told of this, are left to reflect that they are the ones who should be dead, not her, and that the two of them are mere "poltroons and poets," rather than true fighters.

The action of the play is a microcosm of war, not just in Ireland but any conflict in which the actual heroes turn out to be the least expected ones. A young woman sacrifices herself in this case for two men who (although it is somewhat understandable in the context of the war) evade punishment. Rather than stand and fight, both Davoren and Seumas in a moment of fear relinquish their high-minded principles and retreat safely into the background of the great conflict.