Prophet Muhammad observes Vathek from the seventh heaven, but decides not to punish him, believing that the decadent caliph will bring about his destruction.

At court, Vathek makes a fool of himself trying to out-drink the Giaour, and to out-eat him; when he sits upon the throne to administer justice, he does so haphazardly.

His prime vizier rescues him from disgrace by whispering that Carathis had read a message in the stars foretelling a great evil to befall him.

Vathek stays in the area and eventually hears Giaour's voice telling him that if he worships the Giaour and the jinns of the earth, and renounces the teachings of Islam, he will bring Vathek great knowledge and the keys to the "Palace of Underground Fire" where Soliman Ben Daoud controls the talismans that rule over the world.

As the children approach Vathek for the competition, he throws them inside an ebony portal where the giaour feasts upon their blood.

Carathis pleads with Morakanabad to help save Vathek's life; the vizier complies and calms the crowd.

Vathek grows impatient with the giaour, and Carathis advises him to fulfill the pact and sacrifice to the jinn of the earth.

Carathis helps him prepare the sacrifice: she and her son climb to the top of the tower and mix oils to create an explosion of light.

The people of Samarra mistake the smoke rising from the tower for fire and rush to help the caliph, only to be burned alive as Carathis sacrifices them to the jinn.

Vathek's favorite wife, the sultana Dilara, writes to Carathis, informing her that her son has broken the condition of the giaour's contract, by accepting Fakreddin's hospitality on the way to Istakhr.

There, Soliman tells Vathek that he had once been a great king, but was seduced by a Jinn and received the power to make everyone in the world do his bidding.

While the ifrit is bringing Carathis, Vathek meets some people who are, like him, awaiting the execution of their sentences of eternal suffering.

Carathis, Vathek, Nouronihar, and the other denizens of hell lose "the most precious gift granted by heaven – HOPE".

Other Romantic poets wrote works with a Middle Eastern setting inspired by Vathek, including Robert Southey's Thalaba the Destroyer (1801) and Thomas Moore's Lalla-Rookh (1817).

Smith later wrote "The Third Episode of Vathek", the completion of a fragment by Beckford that was entitled "The Story of the Princess Zulkaïs and the Prince Kalilah".

"The Third Episode of Vathek" was published in R. H. Barlow's fanzine Leaves in 1937, and later in Smith's 1960 collection The Abominations of Yondo.

Daniels argued Vathek had little in common with the other "Gothic" novels; "Beckford's luxuriant imagery and sly humour create a mood totally antithetical to that suggested by the grey castles and black deeds of medieval Europe".