When Dave Pelzer was a young boy, his mother was shockingly abusive to him. She refused to feed him, forced him to sleep on a cot in the garage, beat him, burned his arm on the stove, locked him in the bathroom with a bucket of bleach and ammonia, and once even stabbed him—by "accident," she claimed—and refused to take him to the hospital. The abuse is chronicled in Pelzer's first memoir, A Child Called "It," which quickly became a national bestseller. The Lost Boy picks up where A Child Called "It" left off, chronicling David's escape from his mother and his entry into foster care.

The Lost Boy begins in winter of 1970. David is living with his mother, father, and brothers in Daly City, California. One night, in a crazed, drunken rage, David's mother opens the front door and tells him that, if he doesn't like the way she treats him, then he can leave. It's his choice. David hesitates, trained by years of abuse to suspect this is a trap—but when he walks out the front door, she doesn't stop him. He's free. His plan is to live near the Russian River in Guerneville, California, where "The Family" used to spend their summer vacations. Unfortunately, David doesn't know how to get there, nor does he realize that it's an eighty mile walk from Daly City to Guerneville. He gets picked up by the police, who call his parents. His father comes to take him back to "The House," as Dave calls it.

David endures three more years of hell at home before teachers at his school finally intervene. Over the years, the teachers had become increasingly concerned about David's home life, noticing that he frequently came to school in rags, bearing unexplainable bruises on his arms. His troubles at school were not initially attributed to the child abuse and are well chronicled in A Child Called "It." In The Lost Boy, his teachers come together to report the abuse. A police officer pulls David out of school, taking him to a hospital, where doctors document the physical signs of abuse and treat the chemical burns on his arms. The policeman then takes David to live with Aunt Mary, his first foster mother.

David doesn't understand what's happening. He's afraid that his mother will find him and abuse him again. His nightmares all involve his mother screaming that she'll never let him go. Her unexpected visit to Aunt Mary's frightens him half to death. His social worker, the angelic Ms. Gold, helps him work through some of his fear. She explains to him about the upcoming trial, in which a judge will decide whether David will return to his mother or become a ward of the state. In order for the judge to rule in his favor, David must tell the ugly truth about the abuse. This is difficult for him, because the psychological effects of the abuse have shamed him into believing that he deserved it and that he shouldn't have revealed the "family secret."

During the trial, David is stressed out and confused, but in the end the judge rules that David will be a ward of the state of California until he turns 18. His mother suspected that this would happen, and when the trial ends she hugs David and gives him a pile of new toys and clothes. He takes these new possessions with him to his next foster home, where he lives with Lilian and Rudy Catanze and their other foster children, including Larry Junior and Big Larry. David likes living with the Catanzes and enjoys a great deal of freedom, including the ability to ride around on his bike unsupervised. David's emotional problems lead to trouble, however, and he soon begins to seek validation from other boys. He steals candy bars from a local store, and when that grows boring he starts stealing toys. He meets John, a rebellious kid who tries to burn down their school. David puts out the fire, but is blamed for starting it. When he's caught, he's sent to Hillcrest, a juvenile detention center.

Meanwhile, David's mother has slowly been building a case against David, claiming that he's insane and violent and that she was forced to discipline him in order to control him. This is an obvious ploy on her part, and Lilian sees right through it, even if David doesn't. Lilian warns him that if he gets in any trouble in juvenile hall his mother will have all the ammunition she needs to put him in a mental institution. He quickly gets his act together, winning the support of the official at Hillcrest. Now that he's in the system he's assigned a probation officer, Gordon Hutchenson, who replaces Ms. Gold. On the day of the trial, Gordon Hutchenson accompanies David to court. His lawyer has discovered that David might not be to blame for the fire. The lack of evidence against David, coupled with his good behavior at Hillcrest, results in a light sentence—100 days, honoring time served. Upon release, he's allowed to return to the Catanzes' foster home.

Not long after David's release from juvenile detention, Gordon Hutchenson moves him to a different foster home. He stays with Alice and Harold Turnbough for a week before going to live with Joanne and Michael Nulls. Joanne and Michael fight daily, and David never gets comfortable at their house. On his first day at his new school, he gets tricked into calling a girl a "horror" (whore) and is beaten up by the girl's brother. A few weeks later, Joanne and Michael decide to get a divorce. Hutchenson takes David to live with Jody and Vera Jones, an African American couple who have converted the garage into a bunkhouse where all the foster children live. The Joneses live about a mile away from The House. One day, David and his friend Carlos visit David's school and run into his little brother, Russell. David realizes that Russell is being abused. The brothers arrange to meet the next day, but their mother finds out. David gets hit by a car while fleeing, but sustains no serious injuries.

David's stay at the Joneses' is short. A former foster child, a girl, accuses Jody of statutory rape, and the Joneses aren't allowed to foster kids anymore, pending investigation. Some of the foster children are taken to juvenile hall because there are no homes for them. David goes back to the Turnboughs'. This is supposed to be a temporary stay, but extends for months. While there, David begins seeing a therapist, Dr. Robertson, and gets a couple of jobs. He's sixteen and knows that in two years he'll no longer be part of the foster care system. He needs to learn how to take care of himself. Everything is going well when two new boys come to live with the Turnboughs. When the boys steal from David, he decides to leave.

David's new probation officer, Mrs. O'Ryan, places him with John and Linda Walsh, who have three children of their own. When the Walshes move to a plush new neighborhood, David goes with them. Unfortunately, some of his new neighbors are prejudiced against foster kids, and he faces challenges in his new home. However, he's able to make friends and even finds a mentor in Michael Marsh, the "Doc Savage of Duinsmoore Drive." Marsh is a Vietnam veteran and allows David to borrow books from his impressive library. David soon leaves Duinsmoore Drive, but keeps in touch with Marsh.

Once again, David is taken to live with the Turnboughs. One weekend, he heads to San Francisco to visit his father, Stephen. David finds his father in a bar and soon learns that Stephen has retired from the Fire Department. David is disappointed to find that his former hero has been reduced to a drunk. A few months later, David lands a job as a car salesman. He's a good salesman and quickly becomes one of best employees at the dealership. Still, he's unhappy. He tries to join the Army, but they won't take him without a high school diploma. Eventually, the U.S. Air Force helps him get his GED, and he's able to enlist. He doesn't go into detail about his career in this memoir, but the postscripts imply that it was a successful one. In the epilogue, David and his son, Stephen, visit the Russian River, the vacation spot young David was headed to in the prologue. He and his son are a family. At long last, David feels happy and loved.