The plasma science experiment on Voyager 2 made observations of the plasma environment in Neptune's magnetosphere and in the surrounding solar wind. Because of the large tilt of the magnetic dipole and fortuitous timing, Voyager entered Neptune's magnetosphere through the cusp region, the first cusp observations at an outer planet. Thus the transition from the magnetosheath to the magnetosphere observed by Voyager 2 was not sharp but rather appeared as a gradual decrease in plasma density and temperature. The maximum plasma density observed in the magnetosphere is inferred to be 1.4 per cubic centimeter (the exact value depends on the composition), the smallest observed by Voyager in any magnetosphere. The plasma has at least two components; light ions (mass, 1 to 5) and heavy ions (mass, 10 to 40), but more precise species identification is not yet available. Most of the plasma is concentrated in a plasma sheet or plasma torus and near closest approach to the planet. A likely source of the heavy ions is Triton's atmosphere or ionosphere, whereas the light ions probably escape from Neptune. The large tilt of Neptune's magnetic dipole produces a dynamic magnetosphere that changes configuration every 16 hours as the planet rotates.