Mildred Hayes is a divorced mother still grieving the violent rape and murder of her teenaged daughter Angela, seven months prior. Angry over the lack of progress in the investigation, she rents three abandoned billboards near her home, which in sequence read: “Raped while dying”, “And still no arrests?”, and “How come, Chief Willoughby?”
The townspeople are upset over the billboards’ content, including Sheriff Bill Willoughby and officer Jason Dixon. The open secret that Willoughby suffers from terminal pancreatic cancer adds to their disapproval. Mildred and her depressed son Robbie are harassed and threatened, but she stays firm, to Robbie’s chagrin.
While Willoughby is sympathetic to Mildred’s frustration, he finds the billboards an unfair attack on his character. Dixon is vexed by Mildred’s lack of respect for his authority, and counters by threatening Red, who rented the billboards to her, and arresting her friend and co-worker Denise on trivial marijuana possession charges. Mildred also is visited by her abusive ex-husband Charlie, who hurtfully blames her for their daughter’s death.
Willoughby brings Mildred in for questioning after she injures her dentist in an altercation in his clinic, during which he begins coughing up blood, a sign that his illness is becoming severe. He leaves the hospital against medical advice, and spends an idyllic day with his wife Anne and two daughters before committing suicide. He leaves suicide notes for several people in Ebbing, including one to Mildred in which he explains that she wasn’t a factor in his suicide, but he secretly paid to keep the billboards up for another month, amusing himself with the antagonism they would continue to draw to her after his passing. His prediction proves correct, and Mildred receives an especially violent threat from a stranger who enters her store. Dixon reacts to the news of Willoughby’s death by assaulting Red and his assistant, which is witnessed by Willoughby’s replacement Abercrombie, who fires him.
The billboards are destroyed by arson. Mildred retaliates by tossing Molotov cocktails at the police station, which she believes is unoccupied for the night. However Dixon is there to read a letter left for him by Willoughby, in which the sheriff advises him to let go of hate and learn to love, as the only way to realize his wish to become a detective. Dixon escapes the blaze with Angela’s case files, suffering severe burns. Sympathetic acquaintance James witnesses the incident and provides Mildred with an alibi, claiming they were together on a date.
Discharged from the hospital, Dixon overhears the man who earlier threatened Mildred, bragging in a bar of an incident similar to Angela’s murder. He notes the Idaho license plate number of the man’s vehicle, then provokes a fight in which he scratches a DNA sample from his face, for forensic comparison to samples from Angela’s murder. Meanwhile, Mildred is on a faux date to thank James for the alibi, when Charlie enters with his 19-year old girlfriend Penelope, and admits to drunkenly setting the billboard fires. Though enraged, Mildred simply instructs Charlie to treat Penelope well, before leaving.
Dixon contacts Mildred about his hopeful discovery of Angela’s killer, but the man’s DNA doesn’t match and he was also on military duty overseas at the time. Although both are disappointed, they conclude that the man must be guilty of some other rape, and set out for Idaho to kill him anyway. On the way, Mildred confesses to the police station fire, which Dixon had already guessed and accepted. Both express reservations about their mission, but resolve to decide on the way