[5] Lagoon originated as a screenplay Okorafor wrote for Nollywood director Tchidi Chikere, after both were frustrated with "abysmal stereotyping" of Nigerians in the South African film District 9.

Across these three acts, the novel's primary plot revolves around the alien ambassador, Ayodele, and her interactions with three human protagonists: Adaora, a marine biologist; Agu, a Nigerian soldier; and Anthony, a Ghanaian hip-hop artist.

Blending its SF topoi with fantasy and folklore elements, we learn that the three human protagonists have special abilities (Adaora can create a shield around herself and breathe underwater, Agu has superhuman strength, and Anthony can make his voice heard and understood at great distances).

Alongside these fantastical powers, the novel also incorporates various Nigerian folkloric and mythical entities, which physically manifest themselves and interact with the material world after being awakened by the aliens in the second act.

Such figures include Udide Okwanka, a trickster spider and master weaver of tales from Igbo folklore; Legba, the Yoruba trickster god of language and the crossroads who is recast as an expert 419 scammer, but who also shows up in spirit form as Papa Legba; and new figures such as the Bone Collector, a sentient stretch of the Lagos-Benin highway that attacks humans.