The story begins with a woman escaping to a villa in Italy in order to start a new life for herself. She has faked her own death, and we find out about the life she has left behind in flashbacks throughout the book. She has left a husband and the crushing success that has come with a poetry bestseller. She has left a blackmailer. What she has kept is something no one knew- a second identity under which she writes "costume" romance novels. She intends to support herself by continuing to write these books.
The flashbacks don't only reveal the adult life she is leaving behind. They also disclose her adolescence, her difficult relationship with her mother, and how she became the woman she is now. Lady Oracle has a much less serious tone than other books I've read by Margaret Atwood. I don't mean that as a slight. It's just different. I liked it, but I'd recommend starting with another of her books if you haven't read one before.