In a world populated by anthropomorphic talking vehicles, the final race of the Piston Cup season ends in a three-way tie for first place between retiring veteran Strip "The King" Weathers, frequent runner-up Chick Hicks, and brash rookie sensation Lightning McQueen; the tiebreaker race is scheduled for one week later at the Los Angeles International Speedway. McQueen is desperate to win the race, not only to be the first rookie to win the Piston Cup, but also because it would allow him to leave the unglamorous sponsorship of Rust-Eze, a bumper ointment company, and take The King's place on the prestigious and lucrative Dinoco team.
However, he struggles to work with others due to his selfishness, which has caused him to fire three crew chiefs and having his pit crew quit after the race. Eager to get to California as soon as possible, he pushes his big rig, Mack, to travel all night long. While McQueen is sleeping, Mack nods off and is startled awake, causing McQueen to fall out the back of the trailer and onto the road. McQueen wakes up in the middle of traffic and speeds off the highway in search of Mack, but instead ends up in the rundown desert town of Radiator Springs, where he inadvertently damages the pavement of the main road.
The next day, McQueen is ordered by the town judge and medical doctor, Doc Hudson, to leave town immediately, but the local lawyer, Sally, requests that McQueen should instead be assigned community service to repave the road, to which Doc reluctantly agrees. Still in a rush to leave town, McQueen repaves the road shoddily, and is ordered to start again.
During this time, he begins to warm up to the town, and befriends several of its residents. He learns that Radiator Springs was once a popular stop along U.S. Route 66 until it was bypassed with the construction of Interstate 40 and mostly forgotten, and that Doc was the Fabulous Hudson Hornet, a three-time Piston Cup champion whose career ended from a devastating crash in 1954.
He bonds with Sally, who found happiness when she gave up a fast life in Los Angeles to live in Radiator Springs, and now dreams of putting the town back on the map. McQueen finishes repaving the road, reinvigorating the town's residents, and decides to spend an extra day in Radiator Springs with his new friends, but his time there is cut short when Mack and the media descend on the town. McQueen reluctantly leaves to reach California in time for the race while Sally expresses her disappointment with Doc upon discovering that he was responsible for tipping off the media to McQueen's whereabouts.
At the race, McQueen races distractedly and soon falls into last place. He is then surprised to discover that Doc, having a change of heart, has taken over as his crew chief and several of his other friends from Radiator Springs are helping in the pit. Inspired and recalling tricks he learned from Doc and his friends, McQueen vaults into the lead. On the final lap, Chick sideswipes and sends The King into a dangerous crash. Recalling Doc's fate, McQueen stops just short of the finish line, handing Chick the victory, and drives back to push The King over the finish line.
As a result, the angered crowd and media condemn Chick's victory but praise McQueen's sportsmanship. McQueen is offered the Dinoco sponsorship, but declines and insists on staying with Rust-Eze out of loyalty for their past support. Back at Radiator Springs, McQueen reunites with Sally and announces that he will be setting up his racing headquarters there, putting Radiator Springs back on the map.
In a post-credits scene, Minny and Van, a couple who were trying to find the Interstate, are shown lost in the middle of the desert.