A cluster of skyscrapers, lights from the high-rise buildings gleam in the night sky. The young ‘Major’ Motoko Kusanagi, cybernetic operative and leader of secret service unit Shell Squad, is sitting on a rooftop, concentrating on bugging. She wears thermo-optical camouflage specs, and sticking from her neck and back are cables connected to circuits inside the building. The Shell Squad is formed by the government in order to combat a wave of crime it cannot deal with alone.

With her hacking devices, Motoko is able to see and hear the conversation between a corrupt diplomat and a man who appears to be a programmer. Suddenly, the fully-armed troopers of the Ministry of Foreign Affair’s Section 6 security unit storm the room. After heavy fighting, they manage to seize the diplomat, who tries to claim diplomatic immunity. The Ministry at least wants to stop the programmer, whom they say is suspected of contravening arms export laws, from fleeing abroad. But left with no choice, Ministry officials release the man. But just as the Ministry is about to let the suspect slip through the net, the window shatters and there is the sound of gunfire. The diplomat’s head is shot to pieces. In a panic, the troopers fire their weapons outside. All they see in the glittering night is Motoko, dropping smoothly down the side of the building and disappearing into the night, hands protecting her head and a bewitching smile on her face.

Motoko and the rest of the Shell squad have been informed that an internationally notorious computer criminal has surfaced in Japan. This unique and mysterious super-hacker is suspected of a host of offenses including manipulation of the stock market, illegal data gathering, political manoeuvring, terrorist acts and contravention of cybernetic ethics. Although he is believed to be American, little else is known about him. This unidentified criminal is code-named the ‘Puppet Master’ for his habit of taking over human beings in order to manipulate information from them.

The Puppet Master made his first unsettling appearance when he infiltrated a hotline to the Foreign Minister. This occurred one day before the secret negations between the Ministry of Foreign Affairs and the Head of the Republic of Gabel. Colonel Malez, the leader of the former military government, was seeking political asylum. The Ministry had to decide which side to take: Should it accept Colonel Malez or hand him over to the present Gabel government? The Puppet Master apparently wanted to upset the meeting.

Motoko and the Shell Squad manage to trace the Puppet Master after it places a virus into the system. After heavy fighting, the Squad catches the criminal who was trying to prevent the meeting, only to find that he was only a ‘puppet’ used by the Puppet Master.

The Puppet Master fails to stop the meeting and instead targets Megatech Body Co., a manufacturer of artificial human bodies for the government. He easily slips through the government’s top-secret Network protect and starts manipulating the factory, making artificial bodies for his own use. He enters these artificial bodies and causes them to escape. The Shell Squad manage to capture the Puppet Master, but he falls into the hands of Motoko and friends a little too readily. It seems he allowed himself to be caught- but why?

In the course of investigation, Shell Squad discover that the super-hacker started out as a computer virus manufactured by the Foreign Ministry as part of some international racket, before going wild and getting out of control. To prevent this information from leaking, the Foreign Ministry attacks the Shell Squad in the hope of retrieving the Puppet Master. Upon his capture the Puppet Master utters some puzzling words:
 ‘… My code name is Project 2501. I am a living, thinking entity who was created in the sea of information.’ And he’s driven to seek political asylum.

Thus commences the violent struggle between Shell Squad and the corrupt Security Section 6. And all the while the unseen Puppet Master seeks something…