Most good stories start with a fundamental list of ingredients: the initial situation, conflict, complication, climax, suspense, denouement, and conclusion. Great writers sometimes shake up the recipe and add some spice.
Initial Situation
The narrator is a model young black man.
…but we already know he doesn't stay a model young black man, because, as we learn in the Prologue the narrator is narrating from a hole in the ground.
Interestingly enough, the story he tells follows a classic plot analysis; he must be a good storyteller. In the initial situation, the narrator is an "ideal black man": humble, grateful, polite, clean, and intelligent without being "uppity." He has dreams of his own, but thinks that he must bow down to white authority in order to achieve them.
Conflict
He is expelled and banished to Harlem where the world turns on him; he also doesn't have a job.
Getting expelled and going to New York? Sounds like a party to us. (Don't get expelled, kids.)
Although hurt and confused that Dr. Bledsoe expels him, the narrator still trusts that his college president has his best interests at heart. Full of dreams to work hard and prove himself in the big city, he arrives in Harlem only to realize that Dr. Bledsoe's letters of recommendation are, well, not letters of recommendation.
He takes a job at Liberty Paints, which turns out to be a job as a guinea pig. He's in a whole new world. He knows no one and has no source of income. This is the "conflict" stage because the narrator is kept from realizing his dreams of gainful employment and social change.
Complication
The Brotherhood
The narrator falls in with the Brotherhood and finally feels a sense of purpose. Except that the Brotherhood isn't exactly as it seems. Driven by ideology, method, and cold rationality, the Brotherhood is a positive force for the narrator because it gives him direction, but he unwittingly butts heads with many tenets of the Brotherhood. For instance, the narrator has trouble conceiving of society in broad-based terms; he focuses on the individual and the emotional rather than the collective.
Climax
Brother Clifton is shot and the narrator organizes a public funeral… which the Brotherhood finds problematic.
Brother Clifton's death and subsequent funeral prompts the narrator's biggest epiphanies, namely, that the Brotherhood has been using him for unknown ends, and that he (the narrator) is invisible to those around him. Although hints of these ideas have been percolating throughout the novel, they finally come together here in the climax.
Suspense
The narrator tries to sabotage the Brotherhood using Sybil.
The narrator figures he needs to have an informant to find out the Brotherhood's true aims. He decides to seduce a woman and chooses the unhappy Sybil. However, the seduction doesn't go as planned because she wants him to rape her and she has no useful political information. The narrator ends up drunk, sad, and no closer to sabotaging the Brotherhood than before he got naked with a self-proclaimed nymphomaniac.
Denouement
Harlem falls apart, and the narrator falls into a manhole.
In some ways, this denouement is a bit counter-intuitive—shouldn't the narrator have exposed the Brotherhood for being a sham and gone on to champion black rights in Harlem?
Well, maybe, but only if this were a plot-driven, action-packed novel. Being the introspective psychological novel that it is, it makes sense that the narrator drops out of sight of the rest of society. Either way, we've never been able to look at a manhole the same way again.
Conclusion
It's time for the narrator to come out of hibernation.
So the manhole's great and all, since no one's there to try and define him, but there's also… no one there.
Since his social life has taken a hit after the whole falling-into-a-manhole business, the narrator is finally ready to come out of hiding after accepting that living in a manhole is no way to live. He leaves us on that note; we can only speculate what his post-hibernation life looks like.