We start out with a brief breakdown of why Andy and Red are in Shawshank Prison in Maine: They've both been convicted of killing their wives. The only thing is, Red is actually guilty, while Andy isn't. Red gives us a detailed breakdown of Andy's trial and how despite his innocence, he just looks really, really guilty. His cold, methodical personality doesn't help either, and only further convinces the jury that he's a scary killer.
Andy arrives in prison and soon makes a name for himself by fighting the local rape gang (not always successfully) and asking Red—who knows how to get things—for random bits of contraband: A rock hammer, for one, and a giant poster of Rita Hayworth. Yes, the Rita Hayworth. He gets on one of the guards' good sides by helping him secure some insurance money and slowly morphs into the prison's pet accountant, doing everyone's taxes for free and setting up a stellar prison library.
While Andy gets several of the wardens to take a liking to him by helping them with various illicit financial schemes, he and Red become close friends. One of the wardens, Norton, is a real Bible-thumper, but his love for Jesus doesn't stop him from setting up all kinds of shady operations for Andy to manage.
One day, a fellow prisoner named Tommy Williams arrives at the prison with some interesting news. He says he once had a cellmate who worked at Andy's country club and bragged about killing Andy's wife and her lover. Andy goes to Norton in the hopes this new information could lead to a new trial, but Norton, corrupt as ever, throws him in the hole and threatens to tear down the library if Andy pursues the matter. Tommy gets shipped off to a much nicer prison, and Andy gets the shaft. Even in an uplifting story like this, King really knows how to screw over his characters.
Sometime later, Andy talks to Red about some fake IDs he has hidden in a deposit box in the outside world. The key for the box sits under a rock of volcanic glass in a hayfield in the town of Buxton, the safest place in the world to hide any kind of key, according to Andy. He says if he ever gets out, he's going to take the I.D.s and the money and open a hotel in Mexico.
Shortly after that, Andy busts out of prison, using a hole he'd dug for over twenty years and somehow managed to keep hidden behind his girlie posters. They never catch him and Norton is forced to retire when they can't find him. Red is sad that his friend is gone, but pretty pleased about what happened to Norton: Schadenfreude will do that for you.
Sometime later, Red gets paroled. He goes to Buxton and finds the rock of volcanic glass where Andy said it would be. Red looks beneath the rock, where he discovers that Andy left him a note and some money, because he's awesome like that. Red breaks parole and takes a bus to Texas, hoping to cross the border and meet his friend in Mexico.