Phyllis and Neff meet in a planned location at a pre-determined time - Jerry's Market on Los Feliz. The murder plan which will eventually bring them together inevitably means that they must meet surreptitiously so as not to arouse suspicion, running into each other "accidentally on purpose" each morning at 11 o'clock. They talk next to and over shelves stocked with groceries (in front of the Farina 'baby' food section), methodically pretending to be shoppers while cooly discussing the complicated details of the planned murder and waiting for the right set of circumstances to arise.

Right from the start, something goes wrong - Dietrichson's trip must be called off. Phyllis is worried about their original train scheme after her husband broke his leg after falling down at the oil wells before the trip. She is impatient about waiting until he recovers enough to take the train:

Phyllis: What do we do now, Walter?
Walter: Nothing. We just wait.
Phyllis: Wait for what?
Walter: Until he can take the train. I told you, it's gotta be the train.
Phyllis: But we can't wait. I can't go on like this.
Walter: Look, we're not gonna grab a hammer and do it quick just to get it over with.
Phyllis: There are other ways.
Walter: We're not gonna do it other ways.
Phyllis: But we can't leave it like this. What do you suppose would happen if he found out about the accident policy?
Walter: Plenty, but not as bad as sitting in that death house.
Phyllis: Don't ever talk like that.

The conniving Phyllis wishes to do their dirty deed quickly, but Walter wants them to be calm:

Walter: Don't let's start losing our heads, that's all.
Phyllis: It's not our heads. It's our nerve we're losing.
Walter: We're gonna do it right. That's all I said.
Phyllis: It's the waiting that's getting me.
Walter: It's getting me just as bad, baby. We've got to wait.
Phyllis: Maybe we have, Walter, only it's so tough without you. It's like a wall between us.
Walter: I better go, baby. I'm thinkin' of you every minute.

A full week passes, and Neff sits in his office contemplating the "Fates":

After that, a full week went by and I didn't see her once. I tried to keep my mind off her and off the whole idea. I kept telling myself that maybe those Fates they say watch over ya had gotten together and broken his leg to give me a way out.

Then, on the fifteenth of June in his office at three in the afternoon, Neff is offered a desk position as Keyes' assistant, but it would mean a "fifty-dollar cut in salary." Walter quips:

Do I laugh now, or wait 'til it gets funny?

Keyes - with overloaded work, pressure on his nerves and many sleepless nights, thinks Walter would be a skilled claims man, since he was "high man" in the semi-annual sales records twice in a row and he's "too good to be a salesman." To Keyes, a salesman is only a "peddler, glad-handler, back-slapper...All you guys do is just ring doorbells and dish out a smooth line of monkey-talk."

Without a private life of his own, Keyes thoroughly loves the insurance business. He looks at claims work as an endlessly fascinating series of challenges - it's more than just a routine "desk job":

The job I'm talking about takes brains and integrity. It takes more guts than there is in 50 salesmen. It's the hottest job in the business...Desk job? Is that all you can see in it? Just a hard chair to park your pants on from 9 to 5, huh? Just a pile of papers to shuffle around and five sharp pencils and a scratch pad to make figures on. Maybe a little doodling on the side. Well, that's not the way I look at it, Walter. To me, a claims man is a surgeon. That desk is an operating table. And those pencils are scalpels and bone chisels. And those papers are not just forms and statistics and claims for compensation, they're alive, they're packed with drama, with twisted hopes and crooked dreams. A claims man, Walter, is a doctor and a bloodhound...and a cop and a judge and a jury and a father confessor all in one. And you want to tell me you're not interested. You don't want to work with your brains. All you wanna work is with your finger on the doorbell, for a few bucks more a week.

Neff and Keyes are interrupted by a phone call from a "dame" (Phyllis) for Walter. While Keyes remains in the office and Walter pretends he is speaking to a client named Margie, Walter is told that her husband will be taking his scheduled business trip - and boarding the 10:15 pm train from Glendale. [The train station scenes were shot at the Glendale train station.] He will be on crutches with his left leg in a cast. They carefully work out the details, their plans and the disguise that Walter must assume. Walter will be taking Dietrichson's place - becoming both Phyllis's husband and Lola's father at the same time. Phyllis ends the call with a statement of her devotion, using their trademark line about going "straight down the line":

This is it, Walter. I'm shaking like a leaf. But it's straight down the line for both of us. I love you, Walter. Good-bye.

When finished with the call, Walter asks Keyes why he doesn't settle down and get married. Keyes explains how the "little man" has determined the entire course of his life. He even checked up on his fiancee before their marriage and found that she was trampy:

Keyes: Almost did once. A long time ago...Even had a church picked out, the dame and I. She had a white satin dress with flounces on it. I was on my way to the jewelry store to buy the ring. And then suddenly that little man in here started working on me.
Neff: So you went back and had her investigated.
Keyes: Yeah - and the stuff that came out. She'd been dyeing her hair ever since she was sixteen. There was a manic-depressive in her family on her mother's side. She already had one husband. He was a professional pool player in Baltimore. And as for her brother...
Neff: I get the general idea. She was a tramp from a long line of tramps.

Keyes repeats his disappointment that Walter refuses his offer to be his claims assistant, and refers to Neff's size (he's a tall, big man when compared to Keyes' 'little man', but not smart) to reinforce the 'little man' theme:

I picked you for the job, not because I think you're so darned smart but because I thought you were a shade less dumb than the rest of the outfit. (Neff lights the match for Keyes' cigar.) I guess I was wrong. You're not smarter, Walter, you're just a little taller.

When Neff is left alone, he slowly turns and walks to the water cooler, thinking about what hand fate had dealt him - in voice-over:

Yes, Keyes. Those Fates I was talking about had only been stalling me off. Now they had thrown the switch. The gears had meshed. The time for thinking had all run out. I wanted my movements accounted for up to the last possible moment.

The preparations for the murder are beautifully staged in a series of well-paced sequences and actions. Neff meticulously sets up his numerous alibis (e.g., his rate book left on his office desk as if forgotten, a car wash arranged with Charlie, his garage attendant, a toll call on the phone to Westwood, etc.), changes into a navy blue suit resembling Dietrichson's, fakes a cast on his leg, leaves his apartment (via the service stairs) and walks to the Dietrichson house without being seen, and hides on the back seat floor of the Dietrichson car. On his walk, he comments:

I could smell that honeysuckle again, only it was even stronger now that it was night.

At an agreed moment as Phyllis drives her husband to the train station for his four-day trip, she honks the horn three times as a signal. Neff reaches from behind and kills Dietrichson by breaking his neck. There are grunting noises during the struggle. A camera close-up of Phyllis's unmoving and stony face staring straight ahead is all that is revealed during the murder that is brutally carried out on the seat next to her. Neff (viewed entirely from behind and masquerading as Dietrichson) takes the crutches and makes his way to board the San Francisco-bound train while Phyllis removes Dietrichson's suitcase and overcoat. While walking to the end of the train platform, they nervously discuss the next set of detailed arrangements. His plan is to jump off the moving train when it slowed. After rendezvous-ing with Phyllis at the pre-arranged point, he would "replace" himself on the tracks with the dead man.

Hobbling out to the dark observation platform (partially shaded by venetian blinds) for a smoke - the last carriage at the rear of the train, Walter is surprised by the voice of a man greeting him. He is joined by a talkative, Stetson-hatted, friendly fellow passenger named Jackson (Porter Hall) returning to his hometown of Medford, Oregon. Neff must find an excuse to send the man away - to go after his forgotten cigar case in his overcoat at his seat (Car 9, Section 11) - while he jumps from the train at the pre-arranged location.

Phyllis and Neff drag Dietrichson's body and crutches to the tracks, making it look like he was killed when he fell off the train. When they're done setting the corpse on the railroad tracks (to make the double indemnity clause of the insurance effective), Walter tells Phyllis: "Okay, baby, that's it."

And then, in one of the film's most gripping and tense scenes, after committing the murderous crime, their car refuses to start three times as the car motor sputters again and again for many agonizing moments. Phyllis desperately looks at Walter - until Walter finally tries and turns it over. In voice-over, Walter feels confident of their 'perfect' crime, even a bit surprised by how cooly Phyllis responded to her husband's death: "I was afraid she might go to pieces a little, now that we had done it, but she was perfect. No nerves. Not a tear, not even a blink of the eyes..." He is driven to his place and dropped off after they share a kiss and she reminds him: "It's straight down the line, isn't it?"

Neff numbly narrates that even though all the alibis appeared to work, he had an intuition that everything would go wrong, and that he was already a "dead man":

That was all there was to it. Nothing had slipped, nothing had been overlooked, there was nothing to give us away. And yet, Keyes, as I was walking down the street to the drugstore, suddenly it came over me that everything would go wrong. It sounds crazy, Keyes, but it's true, so help me. I couldn't hear my own footsteps. It was the walk of a dead man.

Voice-over narration continues as the scene returns to Walter's office. He sits with his mouth up to the dictaphone microphone. Neff believes he is betraying himself at the office the next few days, looking and feeling like a guilty man:

That was the longest night I ever lived through, Keyes, and the next day was worse when the story broke in the papers and they started talking about it at the office. And the day after that when you started digging into it. I kept my hands in my pockets because I thought they were shaking. I put on dark glasses so people couldn't see my eyes. Then I took them off again so they wouldn't get to wondering why I wore them. I tried to hold myself together but I could feel my nerves pulling me to pieces.

The police suspect no foul play, but the plan goes awry when Dietrichson's accident insurance claim goes to agent Keyes for investigation. In the autopsy, it was reported that Dietrichson accidentally died of a broken neck ("no heart failure, no apoplexy, no pre-disposing medical cause of any kind"). In a memorable scene in the insurance company president's office, Mr. Edward Norton, Jr. (Richard Gaines) doubts that it was an accident, believing instead that the death was a suicide ("I know it was not an accident"). A suicide would relieve the insurance company of having to pay off the claim - an expensive one with a "double indemnity" clause. Keyes, who often relies on intuitive hunches and investigative strategy, disagrees with his supervisor: "Fall off a train? Are we sure Dietrichson fell off the train?"

The self-important Norton has asked the bereaved "widow" Mrs. Dietrichson (a true 'black widow' wearing a black hat and veil) to come into the office for questioning. [As she walks into the office, venetian blind shadows fill the background.] Norton frankly tells her that the company suspects that her husband committed suicide. According to this theory, Dietrichson was depressed from financial worries, took out the accident policy in "absolute secrecy," went on a train trip "entirely alone," "hobbles" out to the observation deck at the rear of the train, and then "gets rid of this Jackson with some flimsy excuse about cigars. And then he's alone. And then he does it...He jumps. Suicide. In which case, the company is not liable." After suggesting that the company could take the claim to court - involving a great deal of expense, lawyers, and time, Norton offers a settlement compromise. Phyllis reacts with imperious conviction and shows her hurt before striding out of the office and slamming the door:

I don't know anything. In fact, I don't know why I came here...When I came in here, I had no idea you owed me any money. You told me you did. Then you told me you didn't. Now you tell me you want to pay me a part of it, whatever it is. You want to bargain with me at a time like this. I don't like your insinuations about my husband and I don't like your methods. In fact, I don't like you, Mr. Norton.

Keyes disguises his criticism of Norton with a football analogy:

You sure carried that ball. Only you fumbled on the goal line. Then you heaved an illegal forward pass and got thrown for a forty-yard loss. Now you can't pick yourself up because you haven't got a leg to stand on.

After contemplating the suicide angle, Keyes explains to Norton how unlikely it is for someone to commit suicide by jumping off a slow-moving train. He reels off an unforgettable, statistical speech about different kinds of suicidal deaths (each with subdivisions) to illustrate how the Dietrichson claim is probably a legitimate accident claim:

...You know, you, uh, ought to take a look at the statistics on suicide sometime. You might learn a little something about the insurance business...Come now, you've never read an actuarial table in your life, have you? Why, they've got 10 volumes on suicide alone. Suicide by race, by color, by occupation, by sex, by seasons of the year, by time of day. Suicide, how committed: by poisons, by firearms, by drowning, by leaps. Suicide by poison, subdivided by types of poison, such as corrosive, irritant, systemic, gaseous, narcotic, alkaloid, protein, and so forth. Suicide by leaps, subdivided by leaps from high places, under the wheels of trains, under the wheels of trucks, under the feet of horses, from steamboats. But Mr. Norton, of all the cases on record, there's not one single case of suicide by leap from the rear end of a moving train. And do you know how fast that train was going at the point where the body was found? 15 miles an hour. Now, how can anybody jump off a slow-moving train like that with any kind of expectation that he would kill himself? No, no soap Mr. Norton. We're sunk and we'll have to pay through the nose, and you know it.

Neff is relieved that Keyes supports their case with his statistics. He lights Keyes' cigar one more time outside Norton's office, and then narrates in voice-over:

I could have hugged you right then and there, Keyes, you and your statistics. You were the only one we were really scared of, and instead you were almost playing on our team. That evening, when I got home, my nerves had eased off. I could feel the ground under my feet again, and it looked like easy-going from there on in. That hundred thousand bucks looked as safe with Phyllis and me as if we had the check already deposited in the bank.

Phyllis phones from the nearby drugstore a block away, asking to come up in a few moments. Neff cautions her: "OK, but be careful, don't let anybody see you."

Almost immediately, the doorbell rings, but it can't be Phyllis that quickly. Walter panics when he opens the door - finding Keyes standing there. With nagging internal questions and dyspepsia about the Dietrichson case, Keyes visits Walter's apartment to explain his "little man's" intuition and indigestion. Stalking the case, looking for a flaw, he wonders why Mr. Dietrichson didn't put in an accident claim for his broken leg when he had accident insurance. Keyes' theory is that maybe Dietrichson didn't know that he was insured. He questions the phony case and unlikely accident ("there's something wrong with that Dietrichson case"):

I've been living with this little man for twenty-six years. He's never failed me yet. There's got to be something wrong.

Keyes believes it's a murder case and not an accident - citing the impossible mathematical probability of a man taking out a policy worth $100,000 if killed on a train - and then two weeks later being killed on a train. He considers that the "wide-eyed dame" Phyllis, the beneficiary, is a prime murder suspect. At this point in their conversation, Phyllis appears in the apartment house's corridor and pauses to listen at the door where she hears their conversation. As Keyes leaves for the elevator in the hallway, Phyllis ducks behind Walter's open door to escape notice and subtly lets Neff know that she's hiding there - one of the film's most suspenseful moments. [In reality, construction and fire codes wouldn't have permitted the apartment door to open outward, with the hinges on the outside.]

After Keyes leaves (after another ritualistic lighting of Keyes' cigar), Walter motions her in quickly and tells Phyllis that Keyes has "stinkin' hunches," and that they must avoid seeing each other for a while so that Keyes won't suspect them while she is "shadowed" during Keyes' investigation. Neff asserts his sexual dominance as they begin to be pulled apart by their doubts:

Walter: Afraid, baby?
Phyllis: Yes, I'm afraid. But not of Keyes. I'm afraid of us. We're not the same anymore. We did it so we could be together but instead of that, it's pulling us apart, isn't it, Walter?
Walter: What are you talking about?
Phyllis: And you don't really care whether we see each other or not.
Walter (kissing her): Shut up, baby.

The scene fades to black.

Upset by the death of her father, Phyllis' step-daughter Lola visits Walter at the office (asking "I'm Lola Dietrichson, don't you remember me?"), where she discloses dangerous suspicions to him about her stepmother. She feels something is wrong regarding both her mother's past death and her father's recent death: "Now it's all back again." She is just as unsettled as she had been when her mother died of pneumonia six years earlier, when under the care of nurse Phyllis ("there was a look in her eyes I'll never forget"), who deliberately left the windows open to hasten her fever and death.

Shortly afterwards, Lola claims that Phyllis married her father for his money. Similarly, Lola saw Phyllis trying on a black hat and veil for mourning (and rehearsing to be a widow) two days before her father's 'accidental' death. She boldfacedly accuses her stepmother of repeated foul play and pre-meditated murder for financial gain:

I caught her eyes in a mirror. They had that look in them they had before my mother died. That same look...I loathe her. Because she did it. She did it for the money. Although you're not going to pay it, are you, Mr. Neff? She is not going to get away with it this time, because I'm going to speak up. I'm going to tell everything I know.

Walter also learns that Lola moved out of the house and is living alone, after breaking up with her hot-headed boyfriend Zachetti after a fight. [Phyllis also became involved with Zachetti - during the lull in her relationship with Walter.] Lola now lives in a small apartment in Hollywood, where there are "four walls and you just sit and look at them." Walter listens sympathetically to her tearful tale but cautions her to not take any action. The scene ends on a closeup of her tear-streaked face.

To keep Lola "quiet," to assuage his conscience, to provide a 'father' figure for her, and to seek companionship during this period when Phyllis is being watched and they cannot meet, Neff spends time with Lola, the daughter of the family. In idyllic two-shots, Neff takes Lola out for a Mexican candlelight dinner on Olvera Street [another reference to Mexico!]. The next day, Sunday, they drive down to the beach, as he narrates: "I had to make sure that she wouldn't tell that stuff about Phyllis to anybody else. It was dynamite whether it was true or not."

Jackson, a key witness in the case - the man on the observation platform from Medford, Oregon - is brought down to the insurance company for questioning. Neff is also called into Keyes' office. As he proceeds into the office, he is startled to see Jackson sitting outside. The dogged claims manager Keyes decides to make a "rather blunt statement" about his pursuit of the case to Neff - his surrogate son:

This Dietrichson business. It's murder, and murders don't come any neater. As fancy a piece of homicide as anybody ever ran into. Smart, tricky, almost perfect - but...I think Papa has it all figured out.

Keyes explains his new theory ("it all fits together like a watch"), one that is exactly similar to the real murder scheme: Dietrichson was never on the train - he was either killed on the train or killed somewhere else and then put on the tracks. Dietrichson was set up by the wife and another accomplice (a lover) - they killed him and then somebody impersonated Dietrichson on the train and jumped off, placing the corpse on the tracks after the train had passed. Jackson, "the only guy that really got a good look at this supposed Dietrichson" is called into the office. After being told by Jackson that Medford residents take their time to make up their mind, Keyes informs him otherwise: "Well, we're not in Medford now, we're in a hurry." Neff is introduced to the one man who saw him on the train - but didn't recognize him, fortunately. After viewing photographs of Mr. Dietrichson, Jackson is certain that the man on the train was not Dietrichson. To Keyes, that testimony means that murder was involved and that his theory is corroborated.

Keyes feels that the "perfect" murder is already coming apart at the seams as he speaks about the two homicidal conspirators who are on a deadly, one-way trolley "ride together...all the way to the end of the line":

It's beginning to come apart at the seams already. Murder is never perfect. It always comes apart sooner or later. When two people are involved, it's usually sooner. Now we know the Dietrichson dame is in it and the somebody else. Pretty soon, we'll know who that somebody else is. He'll show. He's got to show. Sometime, somewhere, they've got to meet. Their emotions are all kicked up. Whether it's love or hate, it doesn't matter. They can't keep away from each other. They may think it's twice as safe because there are two of them. But it isn't twice as safe. It's ten times twice as dangerous. They've committed a murder. And it's not like taking a trolley ride together where they can get off at different stops. They're stuck with each other and they've got to ride all the way to the end of the line and it's a one-way trip and the last stop is the cemetery.