Bajirao Singham (Ajay Devgan) gets transferred to Mumbai and he discovers that one of his team members (Mahesh) is found dead with large bags of money. Bajirao decides to unearth the truth behind it and in this process, he collides with a powerful Baba Ji, Satyaraj Chandar (Amole Gupte) who has high profile connections with politicians.

During this period, Guruji (Anupam Kher), is killed by Baba ji, even though Singham was present at the scene. He vows revenge. Because of this, he has to pretend that he has resigned in front of his family. Due to this his father asks him and his childhood friend, Avni (Kareena Kapoor Khan), to come to their home town, Shivgargh. After some comic scenes, Singham and Avni, fall in love with each other. However, we are then revealed to the fact that, Singham hasn't resigned and came to Shivgargh on a mission to get some proof against Baba Ji.

When they get back to Mumbai, Baba Ji starts threatening Singham's family. He also harms all of Guruji's candidates, including Avni, because her brother is one of the candidates. Singham manages to save everyone but before they resign, a worker of Baba Ji wakes up from coma and testifies against him. Singham arrests Baba Ji and his worker, Prakash Rao. However, some party workers attack outside the court, killing the witness. This causes Baba Ji and Prakash Rao to get a bail.But after Baba Ji gets released Singham goes to his house without police uniform and shoots at his bums and Prakash Rao and Baba tell all the truth.

A few weeks later Guruji's party wins the elections.While going to jail Prakash Rao and Baba threaten Singham.But the van in which Prakash Rao and Baba were going stopped for some time. And a water tanker crashes the van and both of them die.Inspector Phadnis (Vineet Sharma)tells media that there was a brake fail, so it is an accident.

The films ends with Singham,Daya and Phadnis and other police officers walking away.