Career criminal Dean Keaton finds himself gravely wounded aboard a ship berthed in San Pedro Bay, engaging in a fateful confrontation with a shadowy figure known only as Keyser. This eerie encounter ends with Keaton's demise when he is shot and the ship is set ablaze. The subsequent day, law enforcement discovers a macabre scene: 27 bodies and only two survivors, Arkosh Kovash, a Hungarian mobster suffering from severe burns, and the physically impaired con artist, Roger "Verbal" Kint. U.S. Customs agent Dave Kujan arrives from New York City to interrogate Verbal in a makeshift office of LAPD sergeant Jeff Rabin, while FBI agent Jack Baer investigates Kovács’ condition. Through Verbal’s flashback narration, the tangled web of events leading to the ship incident is unraveled.
Flashback to six weeks prior in New York City, where Keaton and Verbal are apprehended along with their criminal associates: Michael McManus, Fred Fenster, and Todd Hockney. They are placed in a police lineup for a truck hijacking none of them acknowledge. Enraged by the police's relentless harassment, McManus hatches a plan for retaliation through a heist. Although initially hesitant, Keaton ultimately consents to rob a jewel smuggler, leading to a multi-million dollar windfall of emeralds and the arrest of over fifty corrupt officers after they leak the details to the media. Following their success, they venture to California to sell the jewels through a contact named Redfoot, who leads them to another heist that quickly spirals out of control when they discover that the haul consists of synthetic heroin, dubbed China White.
The men learn that lawyer Kobayashi has orchestrated their misadventures, revealing that their arrests were no accident. His employer, the feared Turkish crime lord Keyser Söze, whom they have unknowingly wronged, demands they target a ship laden with Argentine drug dealers, ordering the destruction of a staggering $91 million worth of cocaine onboard. The promise of cash for the exchange dangled as a reward spurs their participation in this perilous mission.
During the interrogation, Kujan uncovers that the cocaine was never aboard the ship, prompting questions about Söze's presence on the vessel. Concurrently, at the hospital, Baer learns that Kovács may have encountered Söze, initiating a sketch artist's efforts to render a likeness. Throughout the interrogation, Verbal shares a chilling legend surrounding Söze—once a small-time drug dealer who gruesomely eliminated his own family and then the mobsters holding them captive before vanishing from sight, legend grew that he ran his operations solely through faceless proxies steeped in fear.
As Verbal concludes his twisted narrative, he explains the outcome of their ill-fated heist and how Fenster lost his life while attempting to escape. The group resorted to threatening Kobayashi, who in turn leveraged their loved ones to ensure compliance with their new task. Under the cover of night, they inflict violence upon the Argentinian and Hungarian gangsters on the ship, only to discover there is no cocaine. In the chaos, an unseen adversary slaughters Hockney, McManus, Keaton, and a captive within the ship's confines before igniting a fire.
Kujan’s deduction leads him to suspect that Keaton is none other than Söze, especially after discovering that the murdered prisoner Arturo Marquez had been represented by Edie Finneran, Keaton's girlfriend who was recently killed. Kujan theorizes that Marquez was sold to Söze’s Hungarian adversaries and that Keaton orchestrated the massacre to eliminate Marquez and fake his own death. As Verbal struggles with the truth, he confesses about Keaton’s orchestrations but refuses to take the stand against him. With Verbal's bail generously posted, he walks free.
In a gripping twist, Kujan quickly realizes that Verbal's entire story was a meticulously crafted fabrication, cobbled together from the clutter of Rabin’s office. As Verbal exits, he sheds the facade of his disability, revealing the true extent of his cunning. In a chilling finale, as Kujan races to make sense of the revelations, a composite sketch of Söze arrives—strikingly resembling Verbal—who escapes in a vehicle driven by "Kobayashi." Echoing in the air is Verbal's voice, proclaiming, > "The greatest trick the Devil ever pulled was convincing the world he didn't exist, and like that ... he's gone."
