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.
Exposition aka initial situation
Euro Trip
The first thing we find out about our protagonist Strether is that he's come from America to England and is waiting for a person named Waymarsh whom he's not overly eager to see. It's pretty clear that Waymarsh isn't the best company in the world, but we can also see that Strether has invited him out of a sense of duty, meaning that Strether's the type of dude to puts other people's wants before his own. See, we're getting clues already.
While waiting for Waymarsh in a hotel, Strether also meets a woman named Maria Gostrey. Maria is so candid in talking about stuff that Strether feels he can tell her almost anything. And that's where we get some really solid exposition—in other words, the deets behind the story.
While they chat, Strether gives us all the details about his relationship with his elderly(ish) fiancée Mrs. Newsome back in his home of Woollett, Massachusetts. We also learn about Strether's mission to bring Mrs. Newsome's son Chad back home—a mission that will more or less drive the action for the rest of the book.
Rising Action (Conflict, Complication)
Buying Time Gets Expensive
Once Strether arrives in Paris, he finds Chad and is blown away by what a charming young man this little bratster has turned into. Strether was expecting to find Chad as a total monster living a life of sin. But the more he hangs out with the guy, the more he begins to envy Chad and his cool Paris life.
On top of that, Strether finds that he really likes Madame de Vionnet, the woman who has taken responsibility for molding Chad into the man he is. Strether's direct mission from his fiancée Mrs. Newsome is to not like this woman no matter what. But Strether finds he can't help it—she's just such a charmer.
Things get more complicated as Strether starts leaving important details out of his letters home. He's not lying per se, but he's leaving out the fact that he actually likes Chad and Madame de Vionnet the way they are. Heck, Strether even wants to prolong his vacation in Paris as long as possible—to convince Chad to come home, he says in his letters, but more because he just loves that Eiffel Tower.
A huge part his enjoyment of the place is Strether's belief that Chad's relationship with Madame de Vionnet is "virtuous," meaning non-sexual. He can have fun in Paris all right, but he's still got to stand by his morals. (In case everyone didn't know it from the get-go, this misunderstanding will come back to haunt him).
Eventually, Strether can't hold his tongue anymore. Mrs. Newsome wants to know what's up with the hold-up, so Strether writes home and tells her how happy he is hanging out with Chad in Paris. When he compliments Madam de Vionnet as well, he crosses the line. Learn a little tact, guy. Mrs. Newsome decides to send her daughter, the intimidating Sarah Pocock, to travel to Paris and to find out what exactly is going on with Strether.
After Sarah Pocock arrives, Strether tries to show her what a great guy Chad has become. But Sarah's pride makes her refuse to see it. She leaves Paris and gives Strether an ultimatum from her mother: come home immediately or not at all. In the midst of plenty more drama, Strether's set to stay in Paris, which will effectively ruin his relationship with Mrs. Newsome (and probably his financial future along with it).
Climax (Crisis, Turning Point)
Secret Rendezvous
Strether goes to the French countryside to get away from the tensions and shocks that have beset him in the city. And that's where he gets the shock of his life. He catches Chad and Madame de Vionnet heading to a secluded French hotel, and at this moment he realizes that the two of them have had a sexual relationship all along. The thought that they've been hiding the truth from him makes him feel terribly betrayed. It turns out that he's not one of the cool kids "in the know" like he thought he was.
Falling Action
Strether decides that now that he knows the truth about Chad and Madame, he can't stay in Paris. His entire life there has been based on a lie. He does feel, though, that he can do one last nice thing for Madame de Vionnet before he leaves: he visits Chad and orders him never to leave Madame for his family. This, of course, is the exact opposite of what Strether was sent to Paris to do. But his priorities have changed by this point.
Resolution (Denouement)
I Just Dumped a Girl Named Maria
In the final scene of the book, Strether visits Maria Gostrey to tell her that he's leaving Paris forever. Maria begs Strether to stay so that the two of them can be together, but Strether says his mind is made up. It's nice and bittersweet—just the way Henry James like it. We're less sad and more bowled over by the hundreds of pages it's taken to show us this grand transformation.