A pair of mischievous high school kids create the illusion of a haunting on an unsuspecting elderly neighbor while keeping his every reaction under surveillance. A series of coincidences leads to tragedy.

Harbouring negative feelings of their cantankerous neighbour and cryptic hermit, Harold Grainey, the bored tech-savvy best friends, Ethan and Sean, decide to play a trick on him, under the guise of a psychological social experiment. Thrilled with the idea of becoming the next YouTube sensation, the boys embark on an audacious project to convince the man that his dark and vacant house is haunted and record his unmodified reaction with their advanced computer setup. Now, the stage seems set for the ultimate "Haunting Project". However, who is truly the good neighbour living across the street?—Nick Riganas

Ethan is a tech-savvy high school teenager who lives with his mom across the road from Harold, a grumpy, dislikeable old man who lives on his own, is rude to everybody and does all he can to keep himself to himself. Harold doesn't answer the door to a friend who calls by and threatens to dismember another neighbor's dog when it comes on to Harold's property.

Ethan and his friend Sean have a school project and decide it would be amusing to make Harold believe his house is haunted and monitor his reaction. They know that Harold goes out on a regular shopping trip and never locks his doors, so they purchase some hidden cameras and other electronic gadgetry with Sean's dad's credit card and go to Harold's house while he is out. They set up cameras in different rooms and rig various household appliances so that they can control them remotely. While they are in the house they notice that Harold keeps his cellar door padlocked. This seems odd, given that Harold never locks his outside doors.

The experiments are a success: the boys use a computer in Ethan's bedroom to observe Harold's behavior while making his lights flicker, his screen door bang open and shut and his music player turn on and off. However they are puzzled that Harold doesn't react or appear frightened. Instead, we see him experiencing flashbacks where his wife appears, telling him to fix the screen door (which he eventually does by destroying it with an ax), or asking him if he wants to dance to the music with her. The flickering lights trigger a security alarm which causes police officer Palmer to call by, but Harold rudely sends him away. The boys are also mystified to observe Harold disappearing into his cellar whenever these ghostly events occur; on one occasion staying there all night and emerging only early the next morning. He has also stopped going out of the house.

Convinced that Harold is hiding something in his cellar, the boys call the police anonymously, claiming to have heard a woman's screams coming from his house. Officer Palmer comes to investigate again but leaves without fuss after Harold allows him to search the cellar. Ethan, who has been secretly watching all of this, is certain Officer Palmer missed something and pushes hard for the boys to search the cellar themselves, but Sean refuses and asks why Ethan is so obsessed. It transpires that Ethan didn't just target Harold because he was a mean old man; he also holds Harold responsible for putting Ethan's father in jail. Ethan's father was a violent alcoholic who frequently attacked his mother. During one of these attacks his mother ran to Harold for help and Harold called the police.

Ethan and Sean's relationship deteriorates badly after a party at Ethan's house, where Sean goes into a bedroom to make out with a girlfriend when she discovers a hidden camera and they realize that Ethan is watching them. Sean is furious, declares he want nothing more to do with the experiment and demands the return of all his equipment, but Ethan refuses and threatens Sean with the fact that it is all traceable back to him and his dad's credit card. Their argument is interrupted when Harold's cat knocks over one of the hidden cameras while Harold is asleep in his bedroom and Ethan has to go and recover it before it's discovered. This he does without incident while Sean monitors the cameras to warn him if Harold wakes up. However on his way back out of the house Ethan notices that the cellar door is unlocked. He is overcome with curiosity and goes down into the cellar where he discovers that Harold has made a shrine to his dead wife there. Ethan picks up a hand bell which makes a noise, waking Harold up which Sean observes and warns Ethan by text. Ethan just has time to go back silently upstairs, lock the cellar door, put the bell (which he inadvertently carried up with him) down on the living room table and hide underneath a table before Harold emerges from his bedroom to investigate. Harold notices the bell, goes back into his bedroom and comes out again carrying a handgun. Ethan cowers under the table expecting to be discovered, but to the boys' shock Harold turns the gun instead and shoots himself in the head. Sean rushes over so they can remove all evidence of their surveillance before the police arrive, but Officer Palmer is in the neighborhood, hears the shot and arrives immediately to arrest both boys on the spot.

A final flashback reveals the reason for Harold's behavior. It turns out that Harold was a sad and lonely old man who was deeply in love with his wife. When she fell ill and lay dying, Harold bought her the hand bell and made a solemn promise that whenever she rang it, he would come to her. All this time he believed that his wife was causing the paranormal events and when he heard the bell ring and saw it on the living room table he was convinced that it was she, calling him to join her.

At the resultant criminal trial (for which we saw flash forwards throughout the movie) the boys are given a probationary sentence and a community service order. Afterwards as they leave the courthouse Sean heads off to join his friends and family leaving Ethan on his own. As Ethan stands there, surrounded by a crowd of reporters and photographers all giving him their full attention, a small smile starts to appear on his face.