Paddington receives a heartfelt letter from the home for retired bears in Peru, which reveals that his beloved Aunt Lucy is not only missing him dearly but is behaving unusually. Concerned, Paddington and the Brown family embark on a journey to Peru to visit her. Upon their arrival, they encounter the Reverend Mother, who informs them that Aunt Lucy has vanished in the jungle, leaving behind only her glasses and bracelet—clues that deepen the mystery. In the face of uncertainty, Paddington uncovers a map in Aunt Lucy’s cabin pointing to Rumi Rock as their starting point. The Reverend Mother offers Mrs. Brown a pendant for good luck before she and Mrs. Bird stay back, allowing the Browns to continue their search.
As the Browns seek to hire a boat for their river expedition, they cross paths with treasure hunters Hunter Cabot and his daughter Gina. Hunter quickly spots Paddington's bracelet and shares tales of the fabled city of El Dorado, a mythical destination believed to house ancient Peruvian gold—often sought by adventurers who dare to venture to Rumi Rock, but many never return. Driven by a relentless pursuit of fortune influenced by his ancestors’ spirits, Hunter intends to commandeer the Browns’ trip to discover El Dorado for himself, leading to a heated argument with Gina, who wants to abandon the perilous search. In a fit of anger, Hunter inadvertently causes a scene that results in him falling overboard, leading to a shipwreck.
In a twist of fate, Paddington finds himself separated from the Browns and uncovers Rumi Rock where Hunter awaits him. Mysterious roars echo through the jungle, which Paddington misinterprets as calls from him and Aunt Lucy. Together, they set out on a quest for El Dorado and to find Aunt Lucy. Meanwhile, Gina tracks down the rest of the Browns to reveal her father’s intentions and familial background, prompting their combined effort to rescue Paddington from Hunter’s grasp. Suspicion arises as Mrs. Bird uncovers a hidden agenda behind the Reverend Mother’s actions, discovering a secret room that reveals the pendant is actually a tracking device. With their location now known, Mrs. Bird and the Reverend Mother take to the skies in a plane to come to the family's aid.
In an adrenaline-pumping moment, they reach the heights of an Incan fort, where Paddington’s bracelet somehow fits into a coin slot designed for an emblem. Just as Hunter corners Paddington, the Browns arrive, saving him just in the nick of time. The Reverend Mother reveals her identity as Clarissa Cabot, a cousin of Hunter’s who faked Aunt Lucy’s disappearance to lure Paddington. Tensions rise as she holds the Browns and Gina at gunpoint, only to be interrupted by Hunter, who incapacitates Clarissa during the conflict. The family then uses Paddington's bracelet to gain entry into El Dorado, where they are joyously reunited with Aunt Lucy. She reveals El Dorado is actually an orangery, the place of Paddington’s origins, where her bracelet was once his. As Paddington engages with his bear kin, they delight in the act of making marmalade, but ultimately, he decides to return to London with the Browns.
In the end, reconciliation takes place between Hunter and Gina, while Clarissa faces her consequences, being sent to the North Pole to serve as a nun at the home for retired polar bears. In a delightful twist, several bears from El Dorado make their way to Paddington in London, being named after various London rail stations. Lastly, Paddington and his new bear friends pay a visit to Phoenix Buchanan, who remains optimistic about his imminent release from prison and schemes to stage a play titled "Goldilocks and the Three Bears," featuring none other than the El Dorado bears.
