The main character of the book is a shepherd, Santiago, who lives in Andalusia. One day he had a dream that beckoned him to go to the Egyptian pyramids to find treasure.
In exchange for one tenth of the treasure he would find in the future, a gypsy woman deciphered his dream. He meets an old man, Melchizedek, the king of Salem, who persuades him to go to Egypt and gives him two stones—Urim and Thummim—which will help him find answers in difficult situations.
Santiago sells his sheep and sails to Africa. He ends up in a chain of adventures that ultimately leads him to the Alchemist. The Alchemist teaches him to know himself—“the soul of the world.” He falls in love with Fatima, finds treasure, and passes all the trials fate has prepared for him.