In 1983 in Los Alamos, New Mexico, a police detective (Elias Koteas) enters the hospital room of a disfigured man (Richard Jenkins) and tells him that he will catch whoever else is in league with him, but is then called out to take a phone call. While he is on the phone, a scream is heard, and the detective finds the suspect has fallen out of the window to his death. The man had scribbled a note: "I'm sory (sic) Abby".
Flashback two weeks earlier, Owen (Kodi Smit-McPhee) is a very unhappy and lonely 12-year-old boy, who is neglected by his divorcing parents and continually harassed by cruel bullies. Owen harbors considerable anger against the school bullies; he often enacts imaginary fights where he stabs various targets representing the bullies. While peering at neighbors from his bedroom window with a telescope, he notices a girl (Chloe" Moretz) and a middle-aged man who appears to be her father move in next door. One evening, when Owen is alone in the courtyard, practicing one of his imaginary fights, his actions are observed by the girl who starts the first conversation with Owen. Her name is revealed to be Abby, who claims to be 12 years old. Abby tells Owen that they cannot be friends, but regardless Abby and Owen grow closer, seeing each other at night and communicating by Morse code through the walls of their apartments. At school the main bully, Kenny (Dylan Minnette) scars Owen with an antenna rod; when Abby finds out about this she tells him to defend himself and she will help him if needed.
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