On July 4, 1996, in Southport, North Carolina, Julie James and her friends Ray Bronson, Helen Shivers, and Barry Cox drive to the beach. On the way back, they accidentally hit a pedestrian. Julie's friend Max passes by them on the road. Barry and Helen try to dump the body in the water, but the pedestrian wakes up and grabs Helen. Barry pushes him into the water and the group swears to never discuss what happened.
One year later, Julie returns home from college for the summer. The friends have gone their separate ways, with none of them pursuing their dreams due to struggling with the incident. Julie receives a letter stating, "I know what you did last summer!" She and Helen take the note to Barry, who suspects Max. Julie meets Ray, who now works as a fisherman. Max is killed by a figure in a raincoat wielding a hook. That night, Barry is ambushed by the assailant stealing and driving his car.
Julie researches newspaper articles, believing that the man they ran over was a local named David Egan. Helen and Julie meet David's sister Missy at her home. Missy explains that a friend of David's named Billy Blue visited her to pay his respects. That night, the killer sneaks into Helen's house and cuts off her hair while she sleeps.
The following morning, Julie finds Max's corpse wearing Barry's stolen jacket and covered in crabs in the trunk of her car. When she brings the others to see it, the body has been removed. Julie, Helen and Barry confront Ray, who claims to also have received a letter. Julie goes back to visit Missy, while Barry and Helen participate in the 4th of July parade. Missy reveals that David allegedly committed suicide out of guilt for the death of his girlfriend, Susie Willis, in a car accident and shows David's suicide note. As the writing matches that of the note she received, Julie realizes it was not a suicide note, but a death threat.
At the Croaker Beauty Pageant, Helen witnesses Barry being murdered on the balcony but finds no sign of the killer or Barry. The police officer escorting her home is murdered by the killer. Helen runs to her family's store, where the killer murders her sister Elsa. She escapes and runs toward the street, but the killer slashes her to death.
Julie finds an article mentioning Susie's father, Ben Willis, and realizes Ben was the man they had run over a year earlier, moments after he killed David to avenge his daughter. She goes to tell Ray, but notices Ray's boat is called Billy Blue. A fisherman knocks Ray unconscious, inviting Julie to hide on his boat. On the boat, she finds photos and articles about her and her friends, and pictures of Susie. The boat leaves the docks, and the fisherman is revealed to be Ben Willis, targeting them in revenge for leaving him for dead.
Ben chases Julie below deck, where she uncovers the bodies of Helen and Barry in the icebox. Ray awakens and goes to rescue Julie. He ultimately uses the rigging to sever Ben's hand and send him overboard. He explains that he posed as David's friend and visited Missy out of guilt. The couple reconciles, relieved not to have actually killed anyone after all.
One year later, Julie is in college in Boston. As she enters the shower, she notices the words "I still know" written in the steam on the shower door. A dark figure then crashes through the door as she screams.
Rating: 10 Stars
