The crew aboard a Russian freighter bound for New Jersey encounter a ferocious monster lurking inside its sewage tanks. After the beast drags one crewman to his death, orders are given to purge the tanks. Sometime later, Mulder is pulled off a job performing mundane surveillance work and assigned to investigate a mysterious murder case in New Jersey. He is ushered into the sewers of Newark, into the sewers, where he inspects the corpse of a sanitation worker. Outraged at being assigned to yet another meaningless case, which he believes to be a drug-related killing, Mulder confronts Assistant Director Skinner. Skinner reminds him that the X-files have been closed. Mulder later confesses to Scully that he is thinking of leaving the bureau and pursuing his interest in the paranormal on his own.

While performing the autopsy on the body recovered from the New Jersey sewer, Scully discovers a strange, worm-like creature slithering inside the corpse. Meanwhile, another sanitation worker is attacked by something lurking inside the sewer. This time, the victim survives. Mulder and a hospital physician, Dr. Zenzola, inspect a wound on the workman's back. Unsure about what could have made the mark, Mulder and the doctor tell the man he can leave the hospital. When the workman returns home, a parasitic worm forces its way out of his body, killing him in the process.

Mulder pays a visit to the sewage processing plant. An elderly employee named Charlie discovers a humanoid creature swimming in a sedimentation pond. Terrified, he flushes the system, capturing the creature in the process. Mulder has it placed in a holding cell.

With the creature in custody, Mulder pays a visit to Skinner. He states that had the case been treated as an X-file from the beginning, the workman's life might have been spared.

Skinner tells Mulder that the creature will be institutionalized, and he agrees that the case should have been labeled an X-file. The creature escapes and takes refuge inside a portable toilet near a campsite. It is accidentally sucked inside a tanker truck and transported away. Meanwhile, Mulder receives mysterious messages from a high-ranking government official who makes it clear that reinstatement of the X-Files depends on his success with the assignment.

Mulder tracks the creature to a sewage treatment plant. Scully warns him that the fluke she discovered inside the corpse is actually an incubating larva. This indicates that the creature is trying to reproduce. The agent and a foreman crawl inside a tunnel hoping to locate the creature. It suddenly lunges out of the water and grabs hold of the foreman, dragging him beneath the foul sludge. The foreman resurfaces, gasping for air. The creature makes its way to an overflow pipe, which leads to the sea. Mulder engages a rusty lever, causing a guillotine-like metal gate to drop from above. The creature is severed in two. Later, Mulder meets with Scully, who produces photographs linking the creature to meltdown waste from the Chernobyl Reactor in Russia.