The story, set on Sullivan's Island, South Carolina, is often compared with Poe's "tales of ratiocination" as an early form of detective fiction.

William Legrand has relocated from New Orleans to Sullivan's Island, South Carolina after losing his family fortune, and has brought his African-American servant Jupiter with him.

Legrand has lent it to an officer stationed at the nearby Fort Moultrie, but he draws a sketch of it for the narrator, with markings on the carapace that resemble a skull.

One month later, Jupiter visits the narrator on behalf of his master and asks him to come immediately, fearing that Legrand has been bitten by the bug and gone insane.

Legrand explains that on the day he found the bug on the mainland coastline, Jupiter had picked up a scrap piece of parchment to wrap it up.

Legrand kept the scrap and used it to sketch the bug for the narrator; in so doing, though, he noticed traces of invisible ink, revealed by the heat of the fire burning on the hearth.

The parchment proved to contain a cryptogram, which Legrand deciphered as a set of directions for finding a treasure buried by the infamous pirate Captain Kidd.

The story involves cryptography with a detailed description of a method for solving a simple substitution cipher using letter frequencies.

The encoded message is: The decoded message with spaces, punctuation, and capitalization is: A good glass in the bishop's hostel in the devil's seatforty-one degrees and thirteen minutes northeast and by northmain branch seventh limb east sideshoot from the left eye of the death's-heada bee line from the tree through the shot fifty feet out.Legrand determined that the "bishop's hostel" referred to a group of rocks and cliffs on the mainland, where he found a narrow ledge that roughly resembled a chair (the "devil's seat").

Using a telescope and sighting at the given bearing and elevation, he spotted something white among the branches of a large tree; this proved to be the skull through which a weight had to be dropped from the left eye in order to find the treasure.

Though he did not invent "secret writing" or cryptography (he was probably inspired by an interest in Daniel Defoe's Robinson Crusoe[1]), Poe certainly popularized it during his time.

"[4] In July 1841, Poe published "A Few Words on Secret Writing"[5] and, realizing the interest in the topic, wrote "The Gold-Bug" as one of the few pieces of literature to incorporate ciphers as part of the story.

The Callichroma splendidum, though not technically a scarab but a species of longhorn beetle (Cerambycidae), has a gold head and slightly gold-tinted body.

The black spots noted on the back of the fictional bug can be found on the Alaus oculatus, a click beetle also native to Sullivan's Island.

He sums up Jupiter by noting, he is "a typical Sambo: a laughing and japing comic figure whose doglike devotion is matched only by his stupidity".

[27] Further reprintings in United States newspapers made "The Gold-Bug" Poe's most widely read short story during his lifetime.

[26] George Lippard wrote in the Citizen Soldier that the story was "characterised by thrilling interest and a graphic though sketchy power of description.

[39] Editor John Du Solle accused Poe of stealing the idea for "The Gold-Bug" from "Imogine; or the Pirate's Treasure", a story written by a schoolgirl named Miss Sherburne.

"[48] "The Gold-Bug" also inspired Leo Marks to become interested in cryptography at age 8 when he found the book in his father’s bookshop at 84 Charing Cross Road.

[citation needed] Marks would go on to lead Britain’s code-breaking efforts during World War Two as a member of the Special Operations Executive (SOE).

[citation needed] Poe played a major role in popularizing cryptograms in newspapers and magazines in his time period[2] and beyond.

William F. Friedman, America's foremost cryptologist, initially became interested in cryptography after reading "The Gold-Bug" as a child—interest that he later put to use in deciphering Japan's PURPLE code during World War II.

[50] Poe had been stationed at Fort Moultrie from November 1827 through December 1828 and utilized his personal experience at Sullivan's Island in recreating the setting for "The Gold-Bug".

[60] "The Gold Bug" episode on the 1980 ABC Weekend Special series starred Roberts Blossom as Legrand, Geoffrey Holder as Jupiter, and Anthony Michael Hall.