In Middletown, at 11:14 PM, two cars accidents happen at the same time, affecting the lives of five different groups of people. A drunken driver hits a man in a lonely road near a bridge; three young men hits a woman with a van, one of the passenger  on the road shoots them; a young man robs a convenience store, with the support of the clerk; a man finds a body in a cemetery and gets rid off it; and a young woman pretending to be pregnant tries to raise money for an abortion. All of these characters and their fates are very connected

Mike Enslin (Cusack) is a skeptic and author who debunks supernatural occurrences after the untimely death of his daughter Katie. After his latest successful book, he receives an anonymous postcard of the Dolphin Hotel in New York City bearing the message "don't enter 1408." Viewing this as a challenge, Enslin attempts to book a reservation in room 1408, but the hotel will not rent him the room. However, after being informed by Mike's agent (Shaloub) that the Fair Housing Act requires hotels to rent unoccupied rooms the Dolphin reluctantly reserves room 1408 for Enslin.

Arriving at the Dolphin, Mike is pulled aside by the hotel's manager Gerald Olin (Jackson), who warns him that no one has lasted more than an hour in 1408. Olin offers Enslin an upgrade to the penthouse suite, access to documents regarding the deaths in 1408, and an $800 bottle of cognac. Mike accepts the documents and the cognac but insists on staying in the room, frustrating Olin. The manager gives him the key, warning him that "It's an EVIL  room."

At a remote mansion overlooking a vast, empty bay lake, Countess Federica (Isa Miranda), wheels herself through her dark, empty house. She sorrowfully looks out her window at the rain when Filippo Donati (Giovanni Nuvoletti), her husband, appears and murders her by wrapping a noose around her neck and kicks her out of her wheelchair. The countess cannot stand on or move her useless legs and is strangled to death. But then Filippo is then murdered by a unseen killer who jumps out at him from behind a curtain, and drags his body away. The presence of a suicide note, stolen from the countess' diary, leads the police to believe that she has killed herself.

Several days later, Frank Ventura (Chris Avram), a real estate agent, and his secretary/lover Laura (Anna Maria Rosati) are in bed discussing their plans to take over Countess Federicas property following her murder. They both realized the bay's potential to fetch a large price on the estate market, and they are the ones who have convinced Donati to murder his wife. All that Ventura needs to take control of the bay is Donati's signature on some paperwork, although he does not realize that Donati too has been murdered. Ventura plans to go to his cottage, which adjoins the desired property, to meet with Donati. Laura, jealous of Ventura's obsession with the property, asks to come along. When he tells her to stay put, she complains that he enjoys making her life miserable. Ventura tells Laura about a 'squonk' which is mystical creature who is crafty, but never stops whimpering. Laura understands the analogy and agrees to be patient.