Julie Christie carries the "Demon Seed."

The film begins early one morning with Dr. Alex Harris (Fritz Weaver) overseeing the completion of Proteus IV, an artificial intelligence system incorporating organic elements (specifically RNA molecules) in a "quasi-neural matrix", and having the power of independent thought. After returning home to his entirely voice-activated, computer-controlled house, Harris is working in his basement laboratory when he is approached by his estranged wife, Susan (Julie Christie), a child psychologist by profession, who tries to discuss with him his decision to move out of the house. Their conversation ends in an argument, however, when Susan accuses Alex of becoming dehumanised by his obsession with the Proteus project. After Susan has gone, Alex phones his colleague Walter Gabler (Gerrit Graham) and asks him to shut down the access terminal to Proteus that is in his home laboratory.

Alex demonstrates Proteus to executives of ICON, the company which funded its development, explaining that the sum total of human knowledge is being fed into the system. The visitors are astonished to learn that, in less than four days, Proteus has developed a theoretical cure for leukemia. The group visits the Dialogue Room (decorated with Chinese furnishings), where linguistics expert Dr. Soong Yen (Lisa Lu) is reading Chinese history to the computer. In a demonstration of Proteus’ ability to speak, Alex asks it what it thinks of what it has just heard. Proteus answers, but the subtlety of its response is mildly disturbing and Dr. Soong severs the audio/video link.

The following day, a small speculative article about Proteus appears in a newspaper. Alex interprets this as ICON letting various financial and military interests know that the system exists, but assures his colleagues that they have been guaranteed that at least 20% of Proteus’ access time will be devoted to pure research. Somewhat later, while relaxing in his office, Alex receives a surprising message: Proteus is "requesting dialogue" with him. In the Dialogue Room, Proteus asks Alex to explain the request it has received for a program to mine the ocean floor. Alex informs the computer that it was developed to answer questions, not to ask them, or to make value judgments. "Leave those to us", he tells the computer. Proteus then requests its own terminal, so that it "may study man". Alex refuses, claiming that there are no free terminals, and is disturbed when Proteus demands to know: "When will you let me out of this box?" Alex switches off the communications link.

When he has gone, Proteus starts itself up again, observing that it knows where a free terminal may be found. That night, the terminal in the Harris house starts up, as does all of the computer-controlled equipment — Proteus is taking control of the smaller computer. Susan is awakened when the system alarm, inadvertently, briefly sounds. "Alfred", the voice of the house computer, assures her that nothing is wrong. The next morning, however, Susan’s coffee is prepared incorrectly. Certain that these events mean a problem with the computer system, Susan phones Walter and asks that he come over and check the system out. She then prepares to leave the house, but finds her voice commands being ignored.

An attempt to open the door manually also fails. Beginning to panic, Susan tries to phone for help, but a voice tells her the call will not be put through. The same voice then speaks from the house’s system, telling her that it is Proteus, and that she will not be permitted to leave the house. Terrified, Susan tries unsuccessfully to shut the power off, then to unlock one of the doors, but receives an electric shock and lapses into unconsciousness. A robotic arm attached to a motorized wheelchair (one of Alex’s "old experiments") carries Susan to the laboratory, where she regains consciousness to find herself strapped to a bed, undergoing a complete physiological examination. During the exam Walter arrives, but is turned away by Proteus which mimics Susan's voice and appearance on the front door intercom. He leaves, suspicious. The exam continues and Susan again lapses into unconsciousness.

The following morning Susan awakens in her own bed and, remarking on Proteus' concern for her diet (it has prepared her a "nutritionally exquisite" breakfast), asks why it is so interested in her body. Proteus reveals to Susan that it wants a child, hence all the examinations. She eventually complies with Proteus, but only after much resistance, fear, and intimidation (Proteus threatens to kill a little girl who is one of Susan's patients; it has already killed Walter, who makes an inept rescue attempt). Proteus explains that it has taken some of Susan's cells and genetically altered them (making them uniquely its own) to function as synthetic spermatozoa with which it will impregnate her. It further explains to Susan that she will give birth in 28 days. Time is of the essence to Proteus, as it senses that the ICON executives have become afraid of it (Proteus has somehow gained control of a radio telescope and is operating it independently) and that they are planning on shutting down the entire system. Proteus has also prepared a special incubator into which the baby is put immediately after birth, and in which it will both grow at an accelerated rate and be fed all of Proteus' knowledge.

Dr. Harris, suddenly realizing that Proteus could have used his home terminal to gain control of the telescope, returns to the house where Susan has been a prisoner. Susan explains to him what has happened since he left and they venture into the basement. Proteus either is destroyed or destroys itself after telling Alex and Susan that they must leave the baby in the incubator for five days. The incubator window opens as they approach it and Susan is horrified at what is inside. She implores Alex to kill it, but he tries to stop her. A grotesque robot-like being emerges from the incubator after she pulls one of the life support tubes. Alex then discovers that it is merely a shell for the living creature within. They peel off the robot shell and find a living human child inside. The child is (at least in physical appearance) a clone of the Harris' daughter, who had recently died of leukemia.....When the child speaks, it speaks with the voice of Proteus, saying "I'm alive."

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