Wright began visiting the Ozark Mountains in southern Missouri and northern Arkansas in 1898 at the bidding of his physician, who recommended two vacations a year in a more suitable climate for health reasons.

The main story surrounds the relationship between Grant "Old Matt" Matthews Senior and Dad Howitt, an elderly, mysterious, learned man who has escaped the buzzing restlessness of the city to live in the backwoods neighborhood of Mutton Hollow.

Howitt spends his time alone, acting as a mediator and friend to the mountain people, and trying to recover from his tragic past, which includes the prior deaths of his wife and children, and the later presumed madness and subsequent suicide of his only surviving child, his artist son (later referred to as "Mad Howard").

Howitt's reclusiveness has earned him the moniker "The Shepherd of The Hills", yet he befriends the Matthews clan (the strongest and most respected family in the area) who come to love and trust him.

However, Mad Howard believed that his father's pride of family and place in society would never allow him to approve of his son's marriage to an Ozark country girl.

Over the years, Mad Howard's love for Old Matt's daughter and his guilt over abandoning her slowly drove him insane.

His doctor recommends he take a long vacation, so he spends some time wandering around the country, rediscovering and strengthening his faith.

Here he finally learns of his son's secret, the subsequent death of the Matthews girl, and the identity of young Pete as his grandson.

The Shepherd then confesses his identity to Old Matt and tells him that the betrayer of his daughter is still alive, but dying and desires to be forgiven.

A backdrop storyline surrounds the pretty Samantha "Sammy" Lane and her love of Grant "Young Matt" Matthews, Jr. Young Matt is in love with Sammy, who is also being courted by two other men: Ollie Stewart (a "city slicker" who at the outset appears to have the inside track, but Sammy decides that she doesn't want to move to the city) and Wash Gibbs (leader of the Baldknobbers, a gang who terrorize the countryside wearing frightening masks with horns at their top and who rob banks and settlers as they see fit).

Inside, the artist takes special note of how nicely decorated the home is, and he is especially interested in one room, where paintings of good quality are hanging.

He is greeted by Young Matt and Sammy, and discovers that The Shepherd's prediction had come true – the railroad was blasting away nearby mountains, but he had died while the surveyors were in the area before construction had started (and was buried at Dewey Bald).

[6] The outdoor play features more than eighty actors, forty horses, and an actual nightly burning of the cabin.

While working on Shepherd of the Hills, Wright became disenchanted with his manuscript, opened the door to a potbelly stove, and tossed it into the blaze.