The film opens with a raid on a Chechen mafia safehouse by a United States Army special forces team whose objective is to recover a stolen Soviet nerve agent, DZ-5. The raid is unsuccessful, and one of the commandos is killed. The team is led by Lieutenant Colonel Austin Travis (Steven Seagal).
We are introduced to Dr. David Grant (Kurt Russell), who is taking a flying lesson and nervous about flying on his own for the first time. Later, at the office, he is informed that the world's most feared terrorist, El Sayed Jaffa (Andreas Katsulas), has been taken into custody.
Oceanic Airlines Flight 343 takes off from Athens bound for Washington Dulles. Soon after, the 747 is hijacked by Jaffa's number two man, Nagi Hassan (David Suchet), and a number of Jaffa's men. In London, a suicide bomber blows up a Marriott hotel restaurant, and the American embassy is notified by one of Jaffa's men using a tape recorder playing into a public telephone. The bombing is meant to underscore Hassan's seriousness.
Back in Washington, we see Dr. Grant as a bit of a ladies' man as he attempts to charm a woman at a party with a pair of hockey tickets. His efforts are thwarted, however, as he is interrupted by news of the hijacking.
On the plane, an air marshal (Richard Riehle) hides his gun in an ankle holster. Flight attendant Jean (Halle Berry) notices the words "ARMED AIR MARSHAL" on the passenger manifest, and hides it from Hassan in order to keep him from finding out about the air marshal.
Dr. Grant heads over to the Pentagon, where he and several Pentagon officials, including Colonel Travis, listen to Nagi Hassan demand the release of Jaffa. Dr. Grant, however, does not believe Hassan wants Jaffa released. He believes that Hassan actually arranged for Jaffa's capture, that the hijacked plane is carrying a bomb loaded with DZ-5, and that Hassan wants to detonate the bomb over U.S. airspace, killing 40 million citizens.
At the Pentagon, a plan is worked out that will involve a mid-air transfer of a commando team onto the hijacked airliner using an experimental "Remora" aircraft. The plan is approved, and Colonel Travis assembles his commando team at Andrews Air Force Base. They board with Dr. Grant and engineer Dennis Cahill (Oliver Platt). Much to Cahill's dismay, Travis insists that the engineer come with them when they board the airliner.
The boarding process is complicated by the fact that the pilots and terrorists on the plane are unaware of the presence of the commandos. When the 747 attempts to gain altitude, the commando's aircraft is forced to break away. Most of the team makes it over, but Sergeant "Cappy" Matheny (Joe Morton) is seriously injured and two other team members are electrocuted by some sparks in the Remora. Colonel Travis is caught between the two planes and killed, but not before he manages to close the plane's hatch. The commando team quickly set up in the 747's lower deck.
Because of the botched transfer, military command on the ground does not know whether or not the commandos made it on board. A carrier group has been ordered to intercept the plane and shoot it down over the Atlantic if necessary, killing over 400 passengers on board.
Hassan forces the copilot down into the lower deck to investigate a malfunction caused by the transfer. While down there, he sees the commandos and almost gives their presence away, but recovers and tells Hassan it is merely a fried circuit. In the lower deck, Cahill and Grant reveal that if they fail in their mission before the plane enters US airspace in 3 hours and 50 minutes, the Pentagon will order the plane shot down. With limited options, the commandos begin to search for the supposed DZ-5 bomb. In the cockpit, the copilot quietly mentions to the captain that he saw American soldiers in the lower deck.
As the team discreetly moves through the structure of the plane, setting up cameras that peer into the cabin and searching for the bomb, Senator Mavros' aide encourages the Senator to negotiate with the terrorists, as it will greatly enhance his public image if he is successful. Suddenly, Jean spots Dr. Grant in the elevator of the plane as he is moving between decks. He signals for her to keep quiet. Hassan approaches and grows suspicious, but finds nothing. Jean manages to steal a page from a book in Hassan's coat, which diagrams the blast radius of the bomb over Washington D.C. Senator Mavros, meanwhile, approaches Hassan in an attempt to open a dialogue with him. The team finds the bomb, and Dr. Grant comments that there is "enough nerve agent to wipe out half the eastern seaboard."
On the ground, officials decide to release Jaffa in order to resolve the situation. In order to be set free, Jaffa must convince Hassan to land the plane in a remote location, whereby the terrorists will be given passage to a nation of their choice. Jaffa agrees to try and convince Hassan, "in the interests of peace."
Cappy, although injured, starts examining the bomb. Cappy is immobile, so the team must enlist the help of a reluctant Cahill to tamper with the bomb's arming device, which is barometrically activated. While Cahill and Cappy work together to disarm the bomb, Grant and the other commandos get ready to storm the plane and take out the terrorists. After a few tense moments, Cahill seemingly disarms the bomb, but suddenly someone runs a system test on the bomb and it is revealed that there is another trigger. The team is forced to abort.
Jaffa calls Hassan from a private jet, telling him he is free, but Hassan will not be swayed from his plan, saying "Our destiny is to deliver the vengeance of Allah into the belly of the infidel." Hassan's second-in-command takes exception to this, and the two get into a heated argument. Hassan shoots him. Grant realizes that only Hassan knows about the bomb, none of his men do - which means that whoever ran the system test is not one of Hassan's men, but a sleeper - one passenger among 400.
Cahill determines that in order to disarm the bomb, they have to bypass the primary power sources by adding a power source of their own. He sets to work with Cappy on the task. Meanwhile, Grant enlists the help of Jean in order to find the sleeper. As he explains the task to her over the plane's interior communications system (find a passenger with a small electronic device), Hassan discovers her but again his suspicions are allayed. Jean moves through the cabin, handing out magazines and newspapers. She stops at the air marshal's seat, quietly whispering, "They're here", and pointing at a headline about American soldiers. As Jean helps a lady with her medication, she spots a man with an electronic device. While the man's face is not revealed, she takes down his seat number, 21K, and informs Grant.
Cahill and Cappy seem to be making progress disarming the bomb, until Cahill makes a mistake and the bomb does not detonate. They realize the electronics they have been working on are simply decoys; the real bomb is underneath. Outside, fighter jets arrive demanding that the 747 divert course. Grant and the commandos realize they are about to be shot down, and frantically work out a way to communicate with the jets using the plane's taillights and Morse code.
In the tense cockpit, Hassan calls on Senator Mavros to negotiate away the planes, but instead of letting the Senator talk, Hassan shoots him and threatens the death of one passenger every minute unless the plane is allowed to stay on course. With no other choice, the fighters get ready to shoot the 747 down, but the Morse code message comes through just in time, and the fighters back off. The team is granted 10 minutes to do their job. Captain Rat (John Leguizamo) gives Cahill and Cappy 5 minutes to finish disarming the bomb before the commandos storm the plane. Cappy protests that it will take a lot longer than 5 minutes, but Grant simply tells him to "do the best job he can."
Grant contacts Jean again and tells her to take the elevator down to the lower deck. When she comes back up, Grant is with her with a gun to her back, posing as a terrorist. He takes the man in seat 21K by surprise, but what Jean thought was an electronic device was merely a case of diamonds. Frantic, Grant looks around and spots the real sleeper: Jean-Paul Demou, the man who built the bomb.
Grant fires at him, but misses. Hassan attempts to fire at Grant, but is shot from behind by the air marshal. At that moment, the commandos storm the plane, and a firefight ensues. Most of the terrorists are killed. Demou manages to enter the code to detonate the bomb, but at that moment, Cahill disarms it and the detonation fails. One of the terrorists gets shot by the storming U.S. soldiers and dying, fires his AK-47 randomly and blows a hole in the side of the plane, and Demou is sucked out to his death. As the plane spirals out of control, Cahill and Cappy struggle to retain control of the bomb. Finally, the pilots manage to bring the 747 back into control, and they receive clearance to land at Dulles International Airport.
In a last-ditch attempt, Hassan kills both pilots, hoping the bomb will detonate if the plane crashes. Hassan is shot by Rat, but Grant is forced to attempt to land the 747 despite his limited piloting experience. He misses the Dulles runway, but recognizes the airfield where he normally practices flying and decides to try there. With Jean's assistance, he makes a sloppy but relatively safe landing.
On the ground, the team says their goodbyes, and it is clear the commandos have developed a newfound respect for Dr. Grant. Although called to the Pentagon, Grant invites Jean along for a cup of coffee. As they drive away, Grant asks Jean if she likes hockey....
The film's plot device of a stealth fighter linking with a civilian airliner may have its roots in a F-117 field test, conducted by the famous "Skunk Works". In the test, a "red-eye" transcontinental flight was picked at random by Skunk Work engineers. The test involved flying an F-117 "Have Blue" fighter just below and behind the selected airliner. Engineers then watched radar screens for the airliner's reaction. If the airliner deviated from its flight path, the engineers would assume that the airliner's anti-collision radar system had detected the stealth fighter. According to the story, the unknowing airliner stayed on its preset flight path, as the invisible fighter plane veered off, returning to its test site.