Set during the early 1890s in a fashionable summer resort somewhere on the East Coast of the United States, the book is narrated by a Mr Twelvemough, a popular author of light fiction who has been selected to function as host to a visitor from the faraway island of Altruria called Mr Homos.

To their dismay, it becomes gradually clear to everyone involved in the conversations with Mr Homos—who in the course of the novel becomes less and less reluctant to talk about his own country—that the United States is greatly lagging behind Altruria in practically every aspect of life, be it political, economical, cultural, or moral.

Thus, in the novel the island state of Altruria serves as a foil to America, whose citizens, compared to Altrurians, appear selfish, obsessed with money, and emotionally imbalanced.

In A Traveler from Altruria, Howells acknowledges the history of Utopian literature by having his group of educated characters refer to eminent representatives of that literary tradition such as Campanella (La città del Sole, 1602) and Francis Bacon (New Atlantis, 1623), but also to quite recent authors like Edward Bellamy (Looking Backward, 1888) and William Morris (News from Nowhere, 1890).

"With all those imaginary commonwealths to draw upon, from Plato, through More, Bacon, and Campanella, down to Bellamy and Morris, he has constructed the shakiest effigy ever made of old clothes stuffed with straw," says the professor, one of Homos's discussion partners, to his fellow Americans.

Thus, Altruria is a Utopian country inhabited exclusively by altruists, by people who believe that they have a moral obligation to help, serve, or benefit others, if necessary by the sacrifice of self interest.

The social differences in America are shown by having the rich of the society staying at a luxurious resort near the farms of workers in a lower class.

According to Twelvemough, the successful people become wealthy or powerful because of "their talents, their shrewdness, their ability to seize an advantage and turn it into their own account."

Right from the first moment of his stay at the fashionable summer hotel it becomes evident that Mr Homos's behaviour is fundamentally different from that of the other guests.

He insists on carrying his own luggage, at busy times helps waiters in the restaurant do their job, and chats easily with employees, which makes him rather popular among them but at the same time embarrasses his host: It was quite impossible to keep him from bowing with the greatest deference to our waitress; he shook hands with the head-waiter every morning as well as with me; there was a fearful story current in the house, that he had been seen running down one of the corridors to relieve a chambermaid laden with two heavy water-pails which she was carrying to the rooms to fill up the pitchers.

X) Homos further points out that he considers it strange if people perform exercise in order to stay fit if all they would have to do is participate in manual labour.

The only contact Mrs Makely, the businessman's wife, can claim is occasional charitable visits to an old country woman now confined to her bed.

In Altruria, which is an explicitly Christian country, money has been abolished, so its inhabitants have even forgotten that there used to be a division between rich and poor.

Howells method to fix that thought is the Altrurian system where everyone is guaranteed a share of the national product only if he works at least three hours a day in an acceptable occupation.

David W. Levy has indicated that in A Traveler from Altruria Howells, while pursuing his industrious, profitable career as a man of letters, criticized the business principles that had helped ensure his own success.