Eileen (Robin Sherwood) and her boyfriend Woody (Keith McDermott) are driving through the desert. When their car gets a flat tire, Woody goes to find a gas station. Their friends Becky (Tanya Roberts), Jerry (Jon Van Ness) and Molly (Jocelyn Jones) are traveling separately in a different vehicle. They reach Eileen waiting at the car and they all drive off to collect Woody.Woody has found a gas station but it appears deserted. He enters the back room but becomes trapped when the door closes by itself behind him. Various mannequins appear in the room, and multiple objects fly at him until a metal pipe impales and kills him.A little later, Eileen, Becky, Molly and Jerry happen upon a run-down ghost town called 'Slausen's Lost Oasis' (the tourist trap in the title) and conclude Woody is there. As they drive in, their vehicle mysteriously breaks down. Jerry tries to fix his jeep and the girls go skinny dipping in a nearby oasis. As the three women swim, a strange-looking middle-aged man, who introduces himself as Mr. Slausen (Chuck Connors) appears holding a shotgun. Though outwardly polite, he also seems embittered by the decline of his tourist trap since the local expressway was moved away. The three nude girls feel awkward in the water as he casually chats with them, and they apologize for trespassing on his property.Slausen offers to help Jerry with the jeep, but insists the group go to his house with him to get his tools. There, they see the tourist trap: animated wax works type figures including armed bandits. Eileen is curious about a nearby house, but Slausen insists the women stay inside the museum. Slausen takes Jerry to fix the jeep leaving the women. Eileen leaves to find a phone in the other house. There she finds several mannequins inside the house. Someone calls her name, and a stranger wearing a grotesque mask suddenly appears behind her. Various items in the room move of their own accord and the scarf Eileen is wearing tightens and strangles her to death.Slausen returns to Molly and Becky saying that Jerry drove his truck into town. When told that Eileen left, he goes to the house and finds Eileen has been turned into a mannequin. He returns and tells Molly and Becky he did not find Eileen and will leave again to continue the search. Frustrated, the women also later leave to search for her. Becky enters the nearby house and finds a mannequin resembling Eileen. Becky is attacked by the masked killer and then by multiple mannequins. She later wakes up tied up in the basement along with Jerry. Jerry says the killer is Slausen's brother. Also held captive is a young woman named Tina (Dawn Jeffory), who is strapped to a table. She is killed when the masked man covers her face with plaster, causing her to suffocate. Jerry frees himself and attacks the killer, but is soon overpowered. Tied back up, Jerry tries to reach for a key but the killer telepathically moves it from his reach... revealing that the killer has the power of telekinesis.Molly, still outside searching for the others, is pursued by the masked man. She meets Slausen who drives her to the museum and gives her a gun while he goes inside. The masked man appears and Molly shoots, but the gun is loaded with blanks. The man removes the mask: it is Slausen. She panics and tries to elude Slausen but is soon captured and restrained to a bed.Meanwhile, Becky and Jerry escape from the basement but, get separated. Slausen appears and takes Becky to the museum. There the Old West figures begin shooting at her, and she is killed by a Indian Chief figure who throws a knife at her, stabbing her in the back of the neck.Back at the house, Molly manages to untie herself and attempts to look for a way out. She is forced to hide when Slausen appears again and, using his telekinesis, makes many of the mannequins move by themselves. He finds Molly hiding and invites him to dance with him. Jerry arrives to rescue Molly, but he is revealed to have unknowingly been turned into a mannequin as Slausen reveals it by "removing" his arm. Slausen dances with the mannequin figure of his wife, and Molly sees that the wife has become animated as a real person. Traumatized by all of this, Molly finds a hatchet where she sneaks up behind Slausen, and slams the axe into his shoulder as he turns around. With Slausen finally dead and his power gone, all of the mannequins in the room stop moving.The film then ends where it takes place the next morning, and a grinning and clearly insane Molly is seen driving away in the jeep with the mannequin versions of her friends.