Lila Crane is the younger sister of Marion Crane and lives in Phoenix, Arizona.
When Marion goes missing, apparently having stolen $40,000 from her employer, Lila travels to Fairvale, California, to visit Marion's lover, Sam Loomis, in the expectation of finding her sister there. Sam denies seeing Marion and the pair are soon visited by a private detective, Milton Arbogast, who has been hired by Marion's employer to track down the stolen money.
Arbogast later telephones Sam to say that he's discovered that Marion stayed at the Bates Motel, near to Fairvale and that he wants to question the owner's mother, who he saw sitting at the window in the house behind the motel. When he fails to contact them again, Lila and Sam report their concerns to the local sheriff who tells them that the Norman Bates's mother died many years ago. Without enough grounds to investigate further, the Sheriff is unable to help them.
Convinced that Norman Bates knows something about Marion's disappearance, and worried that the woman Arbogast saw might be her, the pair visit the motel and pretend to be a married couple. Whilst Sam distracts Norman, Lila searches the house behind the motel but finds no sign of her sister. When she hears Norman returning to the house, she quickly hides in the cellar where, to her horror, she discovers the mummified corpse of Norman's mother, Norma Bates. Norman rushes into the cellar, dressed as his mother and screaming "I AM NORMA BATES!", but, before he can harm Lila, he is overpowered by Sam.
As the pair recover from their ordeal, a police investigation results in the recovery of the bodies of Marion and Arbogast from a swamp close to the motel. It transpires that Norma emotionally abused Norman as a child and he developed dissociative identity disorder after murdering his mother and her lover.
In the sequel film Psycho II, which is set 22 years after the original, we discover Lila married Sam Loomis and they had a daughter named Mary. Lila objects to Norman's release from the mental institution and then, in an attempt to have him recommitted, works with Mary to trick Norman into believing his mother Norma is still alive and tormenting him. Lila is eventually murdered in the cellar of the Bates house and her daughter is shot by the police when she tries to kill Norman.