Will McLean [David Keith] is a senior cadet at the Carolina Military Institute, a place that outwardly promises to forge men of honor while quietly tolerating brutal hazing of its new cadets. Among these knobs are the overweight Poteete and Tom Pearce, the Institute's first Black cadet. McLean's mentor, Lt. Col. "Bear" Berrineau [Robert Prosky], asks him to look after Pearce, pulling him into a murky web of power where loyalty is tested and conscience is stretched. McLean shares a dorm with Dante "Pig" Pignetti [Rick Rossovich], Mark Santoro [John Lavachielli], and Tradd St. Croix [Mitchell Lichtenstein], and Tradd even offers him a key to his parents' house, hinting at a possible escape from the harsh routine of the campus.
As term begins, the three roommates participate in breaking in the new cadets, while McLean keeps his distance. This aloofness catches the eye of the school's commanding officer, Lt. Gen. Bentley Durrell [G. D. Spradlin], who cautions him not to become soft. The Ten, a secret senior faction, set their sights on Poteete and Pearce, determined to weed out cadets they deem unfit. Poteete is forced to endure a brutal midnight punishment, left to stand on a high ledge until dawn, while Pearce is brutalized—an emblem of the Ten's power—with the number 10 carved into his back and razor blades concealed in his shoes. Communications are intercepted, blocking McLean's attempts to intervene.
Driven by a sense of solidarity, McLean and his friends kidnap Dan McIntyre, a former Ten member, hoping to uncover the information they need about the Hole—the place where cadets are taken for torture. They arrive just as Pearce faces immolation, creating a distraction that exposes the Ten's leader, John Alexander [Michael Biehn]. McLean's group unmasks Alexander and exposes a system of intimidation at the heart of the Institute.
The Ten strike back by stripping the rest of the group of demerits through their control of the Honor Court, threatening expulsion for the entire faction. In a bid to buy time, McLean proposes resignation if Alexander will show leniency toward Santoro and Tradd; Alexander agrees, buying space for a plan to unfold. McLean then uncovers a deeper history: Durrell, himself a former Ten member, has protected their operations for years. Through journals kept by Tradd St. Croix's family, McLean learns that the Ten has operated in the shadows for a long time, and that Tradd is a member who has steered the group from behind the scenes. In a climactic confrontation, McLean confronts Tradd and throws the house key back at him, signaling the end of the ruse.
Back at the Institute, McLean lays out a hard, public demand: the senior class should graduate on their merits, the Ten must be disbanded and exposed, and Durrell must resign by year’s end. Durrell concedes to avoid a press reveal, agreeing to the terms to preserve the institution. McLean remains on campus until graduation, but the corruption he has uncovered leaves him disillusioned; he declines to attend the ceremony. As he walks out the gates, Bear hands him his class ring, a quiet acknowledgment that he earned it, even as the system he challenged continues to bruise the surface of honor.
