Nuclear experiments in French Polynesia lead to the transformation of an ordinary lizard into the colossal mutant, Godzilla. This fearsome creature makes its way to New York City, wreaking havoc on ships and drowning fishing fleets in its path. Amidst the chaos, the French secret service locates the last surviving fisherman who utters the word "Godzilla."
Enter scientist Niko "Nick" Tatopoulous (Matthew Broderick), who is conducting research on the impact of radioactivity on mutations stemming from the Chernobyl disaster. His findings reveal how this catastrophe altered the DNA of earthworms, resulting in their growth to sizes 17% larger than before. Nick is soon summoned to assist a team tackling the Godzilla crisis. In Panama, he meets Col Hicks (Kevin Dunn) and Elsie (Vicki Lewis), where Elsie, a representative from the National Institute of Paleontology, becomes Nick's supervisor for this mission.
Meanwhile, Audrey (Maria Pitillo), a struggling assistant newscaster in New York City, hopes for a promotion that remains elusive, thanks to her boss Charles Caiman (Harry Shearer), who continuously poaches her best stories. When Nick and his team travel to Jamaica to collect flesh samples from a boat devastated by Godzilla, they encounter Phillipe Roache (Jean Reno), who claims to be from an insurance company yet secretly has his agenda.
After analyzing the creature’s trajectory, Hicks concludes that Godzilla is making its way toward the Eastern Seaboard of the USA. Nick posits that the creature is a mutated hybrid, a direct result of the previous nuclear testing. Upon arriving in New York, Godzilla brings destruction, only to mysteriously vanish within the city's extensive underbelly. As Nick makes his way to NYC, Audrey spots him on television, reigniting old feelings and professional jealousy concerning her own career.
Lucy (Arabella Field), Audrey's best friend, and her husband Victor (Hank Azaria), who also works as Audrey's cameraman, manage to capture footage of Godzilla, catapulting Victor to sudden fame. Meanwhile, Hicks sets up a mobile command center in New Jersey. The crew learns that Godzilla is hiding in the subway tunnels beneath the city.
In a strategic move, Nick advises using fish as bait to lure the creature out. When Godzilla reappears, the ensuing melee results in widespread devastation. It's revealed that Godzilla is a cold-blooded creature, complicating military maneuvers against it. Nick discovers that the creature is pregnant after taking a blood sample. Tensions escalate when Audrey stealthily appropriates Nick's confidential data for a news report, only to have it claimed by Charles as his own.
As a consequence of the report, Nick’s reputation suffers, leading to his dismissal. With the assistance of Roache, who is actually affiliated with the French Secret Service, Nick learns of Godzilla's origins linked to the nuclear tests. Together, they seek to locate Godzilla’s nest, while unbeknownst to them, Audrey and Victor are covertly following them.
In a thrilling climax, the Army sets a trap to capture Godzilla. Nick ultimately discovers the monster's nest located in Madison Square Garden, housing 200 eggs. As the hatchlings emerge, they instinctively search for food. In a desperate plea for action, Audrey broadcasts live from the scene, urging the military to destroy the building before these creatures can escape.
Nick calculates the terrifying potential of these hatchlings—each born pregnant, leading to a possible surge of 40,000 Godzillas in under a year. The Airforce responds in time, obliterating the site just as Nick and his team vacate. Unfortunately, Godzilla arrives, enraged and seeking vengeance. The survivors manage to lure the beast into a trap at the Brooklyn Bridge, successfully orchestrating its destruction with military support.
As the dust settles, Roache absconds with all the footage captured by Audrey, leaving a chilling sense of uncertainty, particularly with one egg remaining from the catastrophe.
