The plot revolves around McGee's investigation into the death of his close friend Tush Bannon, who he suspects has been murdered because of his refusal to sell his waterfront property to developers.

In terms of series continuity, Pale Gray for Guilt is particularly important in that it involves a love interest, Puss Killian, who is central to the final book: The Lonely Silver Rain.

Pressure is being put on the Bannons by a well-connected local businessman, Preston LaFrance, to sell to a large corporation that wants to develop the land for industrial use.

When McGee next goes to call on the Bannons, he finds the motel and marina closed down, and learns that Tush was found dead on the premises the previous day, apparently having committed suicide by releasing a heavy hoist onto his own head.

Suspecting foul play, McGee investigates further and learns that Tush's wife Janine, having been forced to leave the property by bailiffs, has gone to stay with an old friend, Connie Alvarez, and is not yet aware of her husband's death.

Satisfied that Tush did not kill himself, McGee begins a campaign to help Janine and her children financially whilst seeking revenge on those whom he holds responsible.

A message of explanation from Puss Killian makes him resolve to stay away from women for the foreseeable future, and he is left alone with Meyer to resume his usual way of life.