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A geology expedition in the Amazon uncovers fossilized evidence (a skeletal hand with webbed fingers) from the Devonian period that provides a direct link between land and sea animals. Expedition leader Dr. Carl Maia (Antonio Moreno) orders his two assistants to stay in camp while he visits the marine biology institute.
Carl reunites with his friend and former student, ichthyologist Dr. David Reed (Richard Carlson). David works at an aquarium in California, but more recently he has been a guest at Carl's institute in Brazil to study lungfish. David persuades his boss, the financially minded Dr. Mark Williams (Richard Denning), to fund a return expedition to the Amazon to look for the remainder of the skeleton.
Soon after Carl leaves camp, a piscine amphibious humanoid, a living member of the same species from which the fossil originated, becomes curious about the expedition's camp. When its sudden appearance frightens the assistants, they panic and attack, and in response the enraged creature kills them both.
The group goes aboard the tramp steamer Rita, captained by crusty Lucas (Nestor Paiva). The expedition consists of David, Carl, Mark, as well as David's girlfriend and colleague, Kay Lawrence (Julie Adams), and another scientist, Dr. Edwin Thompson (Whit Bissell). When they arrive at the camp, they discover Carl's assistants have been killed while he was away. Lucas suggests it was likely done by a jaguar, but the others are unsure.
A further excavation of the area where Carl found the fossil turns up nothing. Mark is ready to give up the search, but David suggests that perhaps thousands of years ago the part of the embankment containing the rest of the skeleton fell into the water and was washed downriver, broken up by the current. Carl says the tributary empties into a lagoon. Lucas calls it the "Black Lagoon", a paradise from which no one has ever returned. The scientists decide to risk it, unaware that the amphibious "Gill-man" that killed Carl's assistants has been watching them. Taking notice of the beautiful Kay, the creature follows the Rita all the way downriver to the Black Lagoon. Once the expedition arrives, David and Mark go diving to collect rock samples from the lagoon floor. After they return, Kay goes swimming and is stalked underwater by the Gill-man, who then gets briefly caught in one of the ship's drag lines. Although it escapes, the creature leaves a claw behind in the net, revealing its existence.
Subsequent encounters with the Gill-man claim the lives of Lucas's crew members, before the creature is captured and locked in a cage aboard the Rita. It escapes during the night, attacking Edwin, who was guarding it. Kay smashes the creature with a lantern, driving it off, but Edwin is severely injured. Following this incident, David decides they should return to civilization. Mark, obsessed with capturing (or killing) the creature, objects. As the Rita tries to leave, they find the lagoon's entrance blocked by fallen logs, courtesy of the Gill-man. While the others attempt to remove the logs, Mark is mauled to death while trying to capture the creature single-handedly, underwater. It then abducts Kay and takes her to its cavern lair. David, Lucas and Carl give chase, and Kay is rescued. The creature is riddled with bullets before retreating to the lagoon, where its body sinks into the watery depths.
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