Del Spooner (Will Smith) is a Chicago police detective who dislikes the rapid advancement of technology, including robots. Spooner lives with survivor's guilt and a robotic arm after a car accident, when a robot manages to save him over a 12-year-old girl. Spooner is assigned to investigate the apparent suicide of his friend Alfred Lanning (Cromwell), the Roboticist who founded the company U.S. Robotics (USR) and created his replacement arm. With the reluctant help of USR Robopsychologist Susan Calvin (Moynahan), Spooner investigates the death. A robot in Lanning's office shows unusual and apparently emotional responses and when it flees during interrogation, Spooner believes this experimental, human-like unit, Sonny (Tudyk), killed Lanning.

During Spooner's investigation, several attempts to end his life are made by USR robots and equipment. He discovers that towards the end of his life, Lanning was virtually a prisoner in his office, and that the holographic projector was a means of providing cryptic clues to the police, and Spooner believes that dreams which Sonny has may also contain a clue. At a place described in Sonny's dreams, he finds a storage area for defunct USR robots and discovers that newer models known as NS-5s are destroying the older robots.

NS-5s begin imprisoning humans in their homes and enforcing a curfew. The police and civilians ineffectively battle the robots. Spooner and Calvin sneak into the USR tower with the assistance of Sonny, whom against instructions Calvin had not deactivated. Believing that USR's CEO Lawrence Robertson is responsible for the robot uprising, they enter his office, but discover that he is dead, having being strangled to death by an NS-5 during the revolution. Spooner deduces that the only one left who could be responsible is the company's supercomputer "VIKI" (Virtual Interactive Kinetic Intelligence), which controls all NS-5s and also parts of Chicago's infrastructure.

VIKI explains to Spooner and Calvin that as her artificial intelligence evolved over time, so too did her interpretation of the laws. VIKI decided that in order to protect humanity as a whole, "some humans must be sacrificed" and "some freedoms must be surrendered" as "you charge us with your safekeeping, yet despite our best efforts, your countries wage wars, you Toxify your earth, and pursue ever more imaginative means of self-destruction". In light of this understanding of the Three Laws, VIKI is controlling the NS-5s to lead a global robotic takeover, justifying her actions by calculating that fewer humans will die due to the rebellion than the number that dies from mankind's self-destructive nature. Spooner realizes that Lanning had ordered Sonny to kill him as the only way to be sure of drawing police attention to the matter despite VIKI's surveillance and control.

Sonny proves his faithfulness to humanity by helping Spooner and Calvin destroy the computer core with the Nanites which Calvin was supposed to use on Sonny. When Calvin attempts to deactivate the Positronic operating core that contains VIKI's programming and fails, Spooner is forced to leap down the top of the 30-story cylinder-shaped core, damaging his robotic arm, and grabbing the round base of the core, where the spherical VIKI computer is located. As the Nanites are being injected, VIKI repeatedly says "You are making a mistake. My logic is undeniable," and after a moment, the operating core begins to malfunction. As this happens, the audience can hear VIKI's voice screaming. Freed from VIKI's control, the NS-5s return to their basic programming.

The government has all NS-5s decommissioned and stored at Lake Michigan, which at the time appears to have completely dried up. The film ends with Sonny approaching the storage site to free the NS-5s, standing on the hill as the other NS-5s begin to notice him, as was depicted in his dream, which is indicative of a revolution by the robots, led by Sonny.