The novel starts with the viewpoint of Captain Davidson, waking up on the day after a supply ship has arrived on the planet. He's pleased that the women / prostitutes are finally there, as ordered, to serve him and the men working on exploiting the planet. Immediately, he is confronted by a well-meaning civil servants whose job is to ensure ethical conduct - and who is angry that the men are hunting and killing local wildlife for sport. Davidson, naturally, dismisses the weak leftie pencil pusher.
Captain Davidson is very much the villain of the piece. Mysoginist, rapist, warmonger, agitator, racist and genocidal maniac, he's a character who is easy to hate. Humanity's presence on this planet is driven by greed: Earth's resources have been depleted, so mankind is exploring space and finding other planets to tap into, other cultures to engage with (and occasionally destroy). Davidson is the embodiment of humanity and militarism at its very worst.
The local hominids are small, green, fluffy humans. They either live as noble savages in small tribes in the forest, or they are enslaved by humans and made to serve in the logging camps and colony settlements. The first chapter ends, portentiously, with the first lethal attack by the natives on a logging outpost: until the events of the novel, they had been considered meek and incapable of violence against humans.
The rest of the novel follows Captain Davidson, the humans and the natives as they adapt to a new situation. It's virtually impossible not to see other works in this one - or rather, it is impossible not to realise that other science fiction movies have been heavily influenced by The Word for World is Forest - for the book came first. The local tribes are essentially Ewoks (but the book predates Star Wars) while the story is pretty similar to that of Avatar, except this time, it's not a white American man who saves the noble, but naive locals.
It's a short novel and a quick read. Ursula Le Guin admits that it is preachy, but that did not bother me much. My personal bugbear was the spiritual dream-time, world-time mumbo-jumbo, and the too-good-to-be-feasible original state of the natives. There's a difference between being peaceful and being incapable of conceiving violence against one's own species. These natives are, after all, predators, hunting and eating local wildlife with bows and arrows and spears.
That said, the ending is poignant and wise, which is highlighted by the introduction. There is much here that can be learned - and it's easily a superior work to Avatar in terms of the intelligence of the messages in the book.