Gawain finds himself alone on a grand throne, adorned in regal attire, as a crown mysteriously falls upon him. Just as it settles, flames engulf his head. He awakes on Christmas morning in a brothel, welcomed by his lover, the commoner Essel. After returning to Camelot, he faces the stern judgment of his mother, Morgan le Fay, before joining his uncle, King Arthur, at a feast at the Round Table. In a secluded tower, Morgan practices her magic. Suddenly, the enigmatic Green Knight rides into Arthur's court, challenging any knight bold enough to strike him with the promise of a verdant axe. The catch? The knight must seek him out at the Green Chapel the following Christmas to receive an equal blow in return. Fueled by valour, Gawain accepts the challenge. Rather than a fight, the Green Knight kneels, allowing Gawain to behead him. To Gawain's shock, the Green Knight lifts his severed head, reminds him of their pact, and departs from the castle, leaving a trail of laughter behind.
As the year unfolds, Gawain’s tale becomes legendary; however, he spends much of his time in revelry. With Christmas approaching, King Arthur prompts him to honor his end of the agreement. Gawain sets off on horseback for the Green Chapel, clutching the green axe and a protective green girdle crafted by his mother, who assures him it will shield him from harm.
During his expedition, Gawain encounters a young scavenger sifting through a battlefield who directs him to a stream leading to the Green Chapel, prompting Gawain to reward him with a coin. Soon after, the scavenger and his companions ambush Gawain, stealing his belongings and leaving him bound. Wielding his sword, Gawain frees himself and gives chase.
That night, he discovers an abandoned cottage and dozes off in bed, only to be roused by the ghost of a young woman named Winifred. She implores him to retrieve her skull from a nearby spring. Upon his return, he finds her remains in the bed and places the skull beside her; in the following morning, his axe has mysteriously been returned.
Continuing his journey, Gawain meets a fox who becomes his ally. They observe a procession of female giants crossing a valley. Eventually, he arrives at a castle, where the Lord informs him of the Green Chapel's proximity and invites him to stay. Within the castle, he encounters a blindfolded old woman and the Lord's wife, who makes tempting advances toward him. The Lord proposes a game: they will exchange whatever they gather during their separate pursuits. The next day, the Lady presents Gawain with the green girdle, asserting that she crafted it herself. Gawain, succumbing to her advances, loses his knightly virtue and is subsequently chastised by the Lady, who is secretly observed by the old woman. Gawain escapes but runs into the Lord in the wilderness, who playfully reminds him of their pact and kisses him in exchange for the Lady’s indiscretions. The Lord then reveals he has captured Gawain’s fox but grants him freedom.
Arriving at a stream, Gawain discovers a waiting boat. The fox, now taking on a human voice, warns Gawain against continuing his quest, urging him to abandon it. Yet Gawain remains resolute and boards the boat toward the chapel, where the Green Knight is peacefully resting in hibernation. After a long night, the Green Knight awakens on Christmas morning to finalize their challenge. As the Knight swings the axe, he twice halts before Gawain flinches in fear. In a moment of panic, Gawain bolts back to Camelot, where he is eventually knighted and ascends to the throne upon his uncle's death. Although Essel bears his son, Gawain opts for a noblewoman instead. As time passes, he loses his son to war and becomes a despised king. With his kingdom under siege and his family gone, Gawain tears the green girdle from inside himself, leading to his own head's demise.
Gawain awakens from this haunting vision, still kneeling in the Green Chapel, where he finally discards the girdle and bravely accepts his fate. The Green Knight acknowledges Gawain's courage, tracing his finger across Gawain's throat as he declares, >“Now, off with your head.”
In a surprising post-credits scene, a young girl discovers the King's crown, placing it atop her head, hinting at the cyclical nature of power and legacy.
