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During a raid on a meeting with a foreign representative that he suspects involves corruption and criminal activity, Public Security's Daisuke Aramaki encounters a mysterious cyborg. Introducing herself as Motoko Kusanagi, the cyborg proposes the formation of a new special forces unit to the Minister of Internal Affairs. Aramaki asks Kusanagi to investigate something as a first step.
Kusanagi and her team begin operating as the Shell Squad after being scouted by Aramaki. At some point, the cyberbrain of the Foreign Minister's interpreter was infected by a virus. Aramaki senses that Col. Malles, who is living in exile in the country, is trying to interfere with a secret meeting. He orders Kusanagi to back-trace the hack and find the culprit.
Kusanagi and Togusa take their suspect into custody after a furious chase in their Fuchikomas. Elsewhere, Aramaki and Batou are staking out Col. Malles when he is paid a visit by someone they suspect is the Puppet Master, the hacker who released the virus on his orders.
There has been a rash of attacks against humans by promotional sample robots. Kusanagi's team rounds up robots of that same model line, and they learn that they all share a common trait. Batou and Togusa head to Hanka Precision Instruments, where they are made, to determine what is behind the attacks.
Kusanagi and the team go to the Far North to surveil a combat cyborg named Koil Krasnov. To determine what Koil is after and uncover corruption behind the expansion of Sagawa Electronics' underground factory, Kusanagi infiltrates Sagawa's offices while Batou and the rest make for the underground factory.
Kusanagi and her boyfriend are rushed to the hospital after being attacked without warning. They suspect Toru Soma, a terrorist that Kusanagi has a history with. Kusanagi and Togusa leave the hospital, and after leading their pursuers on a chase, they find themselves in a fierce battle against an armed group in an abandoned factory.
A robot flees from Megatech Body Co., Ltd. Section 9 takes it into custody, only to find that the Puppet Master is inside it. The Puppet Master announces to Aramaki's team that it is "a life form that arose spontaneously in the sea of information." Moments after it requests political asylum, it is stolen by an unknown party.
Kusanagi regains consciousness after a brain-dive into the Puppet Master. Although they now know the truth behind what happened, Kusanagi keeps sensing the Puppet Master's presence from time to time. The Shell Squad raids a boat being used by a terrorist cell, and Kusanagi mistakenly guns down its leader.
Footage of the incident is leaked to the media by some unknown party, and Kusanagi is accused of murdering the terrorist in cold blood. Kusanagi, suspecting that the Ghorantl intelligence service is pulling the strings behind the scenes, conducts a solo investigation, but she finds herself put on trial.
Kusanagi loses her prosthetic body when it is gunned down, and she flees the scene with Batou as a disembodied brain. They go to Batou's safehouse to get her a new body, but she is channeled into by the presumed-destroyed Puppet Master while in lockdown mode.
