Thaniyavartanam is a movie that revolves around Balan Mash (Mammootty), an art teacher living in a small village in Kerala. He leads a peaceful life with his family, including his wife, two children, mother, and revolutionary brother Gopi (Mukesh). The family has a deep-rooted belief that one male from each generation will go mad due to a curse from the goddess 'Devi'.
After his mentally challenged uncle passes away, the town begins to speculate whether Balan or Gopi will be the next to succumb to madness. Balan starts experiencing nightmares, leading people to suspect his sanity. Despite being declared sane by a doctor, society continues to view him as a lunatic.
Feeling helpless, Balan pretends to be mad, and his own family eventually turns against him, sending him to an asylum. In a tragic turn of events, Balan's mother (Kaviyoor Ponnamma) poisons him to release him from his suffering.
Aside from the main plot, the movie also sheds light on the dynamics of a matriarchal society, showcasing how the hero's uncle (Ammavan played by Thilakan) wields significant influence in family matters, contributing to Balan's descent into madness.