In a bid to reform the police force in a sprawling city, Mayor Mary Sue Beal introduces a bold decree, allowing all applicants for the police academy, no matter their past criminal histories, to join. This presents an intriguing opportunity for Carey Mahoney, a charming repeat offender. His father’s influence grants him a deal from Police Captain Reed: enroll in the police academy to transform himself or face jail time. The notch in this agreement? If Mahoney fails the academy, he’ll go straight to prison. With cunning in mind, Mahoney accepts the challenge but plots to underperform just enough to get expelled.
As the academy's dynamics unfold, Chief Henry Hurst fumes over Beal’s decision and makes it his mission to make life unbearable for the new recruits, pushing them to resign in frustration. Lieutenant Thaddeus Harris, a tough instructor, takes charge of enforcing this chaos, designating cadets Blankes and Copeland as squad leaders to assist him in his efforts.
In a twist of fate, Commandant Eric Lassard believes in giving the fresh recruits a fair shot. He reveals to Mahoney that he has struck a deal with Captain Reed: Mahoney must finish the entire police academy course. Amidst this adversarial environment, Mahoney finds himself enchanted by fellow cadet Karen Thompson and creates bonds with a colorful ensemble of characters, including Larvell Jones, a human beatbox, George Martin, a notorious lady’s man, Eugene Tackleberry, a gun enthusiast, the timid Leslie Barbara, the clumsy Douglas Fackler, and the gentle giant Moses Hightower.
As tensions flaring in the academy reach a peak, Blankes and Copeland snoop on Mahoney's secretive plans for a party, compelling cadet Barbara to expose its location. When Barbara probes about the gathering, it’s clear who’s after the intel. Their antics lead them right to Mahoney’s infamous party spot, the Blue Oyster Bar—a gay biker bar that presents its own set of challenges for them.
Motivated by revenge, Blankes and Copeland devise a petty trick to plant a prostitute in Barbara’s dorm, hoping to spark his expulsion. In a comedic turn, Mahoney manages to sneak the woman off-campus, yet chaos ensues when they find themselves crammed under a lectern during a meeting helmed by Commandant Lassard. Amidst the pandemonium, the unexpected happens as the prostitute distracts Lassard while he speaks, leaving Mahoney clueless about the ensuing spectacle.
Later, as Hightower confides in Mahoney about his lifelong aversion to driving, they commiserate and form a scheme to let Hightower practice for his driving test using Copeland’s tiny Honda. Surprisingly adept despite the awkwardness, Hightower easily maneuvers the compact car and passes his exam remarkably well. However, tensions ignite when Copeland hurls a racial slur at Laverne Hooks, inciting Hightower’s ire and leading to a revenge tactic that ends with Copeland trapped in his police cruiser after crashing it into an embankment, prompting Harris to expel Hightower as a consequence.
Meanwhile, Blankes and Copeland actively pursue a brawl with Mahoney, yet their plans fall apart when Barbara intervenes, using her metal lunch tray to knock out Copeland. The escalating conflict eventually leads to Mahoney’s expulsion for defending Barbara.
All the while, Fackler’s careless tossing of apples launches a chaotic sequence of events that erupts into a riot downtown. As Mahoney prepares to exit the scene, he rallies his fellow cadets to quell the disorder, ultimately finding themselves amidst the fray. In a twist, Blankes and Copeland seek refuge at the chaotic Blue Oyster Bar while the riot escalates.
Before the dust settles, a gang seizes Harris as a hostage, igniting Mahoney’s passionate rescue attempt, which lands him in trouble as well. It’s Hightower who turns the tides by clever cunning that leads to the gang leader's downfall and the rescue of Harris—securing their reputation.
In the end, Mahoney and Hightower earn reinstatement and are hailed as heroes for their valor. When it's time for graduation, Mahoney's lengthy speech takes a comical turn as he spots a familiar figure hiding within the lectern, leading to a series of mischief and interruptions, all under the watchful and amused eyes of Lassard. Their bumpy journey culminates in a well-deserved graduation, sealing their chaotic yet adventurous experience at the academy.
