As the exhilarating time of Tottington Hall's annual giant vegetable competition draws near, the cheese-loving inventor Wallace and his clever beagle Gromit work hard running a humane pest control service called "Anti-Pesto." Their mission is clear: protect local gardens from the pesky rabbits that threaten to devour the precious vegetables. On a fateful evening, Wallace captures some rabbits that have invaded the garden of Lady Tottington with his quirky invention, the "Bun-Vac 6000." In a moment of eccentric inspiration, he decides to utilize his latest contraption, the "Mind Manipulation-O-Matic," to reprogram the rabbits' cravings, aiming to make them dislike vegetables altogether.
However, chaos ensues when Wallace inadvertently misadjusts the settings on the Bun-Vac, resulting in his brain being merged with a rabbit’s! This unexpected twist of fate compels Gromit to swiftly dismantle the machine in an effort to avert disaster. Miraculously, the procedure appears to be successful, with their new rabbit companion, aptly called Hutch, seemingly losing all interest in the veggies he once adored.
Yet, the tranquility does not last long. That very night, a formidable, rabbit-like creature—a true terror for the town—begins ravaging gardens and devouring crops, while Wallace and Gromit find themselves unable to thwart the menace. The following day, during an urgent town meeting, the townsfolk learn that the ominous creature is none other than the infamous Were-Rabbit. Hunter Victor Quartermaine, driven by a desire for glory and the affections of Lady Tottington, naively volunteers to eliminate the beast. Nevertheless, Lady Tottington advocates for Wallace and Gromit, urging the community to give them another chance.
In a comically unfortunate event, Anti-Pesto attempts to trap the Were-Rabbit using a fabricated female version of the creature, but their plan falls hilariously flat. In an alarming turn of events, Hutch undergoes a mutation that raises suspicions in Wallace’s mind. He wonders if Hutch has transformed into the beast itself. Upset by this notion, Gromit takes the prudent step of securing Hutch in a high-security cage. However, during his investigation, Gromit stumbles upon a trail of footprints that leads him to Wallace's bedroom, where he uncovers a stash of half-eaten vegetables—an alarming sign that his beloved owner is the true culprit.
Upon reflecting on his recent triumph with Lady Tottington, Wallace encounters Victor in the shadowy forest as the latter conspires to woo the lady for himself. In a twist of fate under the illuminating full moon, Wallace cannot control his transformation and becomes the Were-Rabbit, shocking both Gromit and Victor before he flees the scene. Seeing this as the perfect moment to eliminate his rival, Victor commissively acquires three "24-carat" gold bullets from the town’s vicar, Reverend Clement Hedges, intending to use these lethal weapons against Wallace.
As the fateful vegetable competition day arrives, Gromit desperately informs Wallace that the bizarre experiment has swapped their personalities. The only hope lies with Hutch, who has now adopted human characteristics and is capable of fixing the disastrous Mind-O-Matic. Further complicating the situation, Lady Tottington pays a visit to alert Wallace about Victor's sinister scheme. As the moon rises ominously, Wallace begins his transformation once again, urgently urging Tottington to leave for her safety.
In a climactic turn of events at the competition, Victor, having expelled all of his gold bullets, resorts to using an elephant gun and aims to use the coveted Golden Carrot trophy as ammunition against Wallace. Steeling himself, Wallace carries Lady Tottington atop Tottington Hall, revealing his true nature to her in a moment of vulnerability. Meanwhile, Gromit musters his courage as he engages in an aerial battle with Victor's dog, Philip, making ingenious use of planes repurposed from a fairground attraction.
As tensions heighten, Gromit courageously guides his plane into Victor’s line of fire, causing a bullet to ricochet off target and strike the plane instead. In a particularly brave act, Wallace leaps into the fray, breaking his fall as he lands amidst a cascade of cheese in a tent below. Lady Tottington swings a mighty prized carrot, knocking Victor unconscious, while Gromit ingeniously disguises Victor in the female Were-Rabbit suit, inciting the townsfolk and Philip to hilariously chase him away.
In an emotional climax, Wallace appears lifeless when he transforms back into his human form, but Gromit valiantly revives him with a touch of Stinking Bishop cheese. In recognition of Gromit's courage and quick thinking, Lady Tottington bestows upon him the Golden Carrot, and she graciously converts Tottington Hall's grounds into a sanctuary for Hutch and the other rabbits, ensuring their safety for years to come.
