In 2019, the Indian Government revokes Article 370, which grants special status for Jammu and Kashmir. The news impacts a cancer-ridden Pakistani army general, Qadir, who decides to exact vengeance against India. He signs a contract with Jim, who leads “Outfit X”, a private terrorist organization. Meanwhile, Pathaan, a former RAW agent, and his senior officer Nandini, open a unit dubbed, “Joint Operation and Covert Research” (JOCR), recruiting agents who were forced to retire due to trauma or injury.

With RAW joint secretary, Colonel Sunil Luthra’s acceptance, Pathaan and his team head to Dubai to stop Outfit X’s plans of attacking the President of India at a scientific conference. However, they realise that their plan was to kidnap two scientists. Jim attacks the scientists’ convoy and Pathaan tries to stop him. A fight ensues, where Jim manages to escape with one of the scientists. Luthra reveals that Jim was a former RAW agent and Kabir’s partner, who was awarded the Vir Chakra for his bravery, after the agency could not find his body when Somalian terrorists killed his wife and unborn child, in a negotiation gone-wrong. He had apparently faked his death in order to seek vengeance against the agency and country for not saving his family.

Meanwhile, Pathaan learns about the codeword dubbed “Raktbeej” and also that the dead people in Dubai were ex-agents and their money was transferred from the account of Rubina Mohsin, a Pakistani doctor in Spain. He travels to Spain and is captured by Jim’s men, where he learns that Rubina is an ex-ISI agent. When Jim leaves his hideout, Rubina attacks Jim’s men and escapes with Pathaan. Rubina reveals that Raktbeej is in Moscow, where they travel to steal it before Jim does. However, Rubina betrays Pathaan and has him captured by the police. It is revealed that Jim used Rubina to make Pathaan steal the Raktbeej for himself. Pathaan is captured and taken to prison, by train, but is saved by Tiger.

Three years later, Pathaan travels to Africa and captures Jim’s henchman, Raafe. He meets Nandini and reveals about Jim purchasing two saber missiles, while Nandini reveals Rubina’s location in Paris. Pathaan meets Rubina, who reveals that the Raktbeej is a smallpox-designed mutated deadly virus, made by the scientist Jim captured. She also expresses guilt about betraying Pathaan without knowing that her country would plan such an attack. They travel to Jim’s lab in Siberia and manage to recover one orb containing the virus, while Jim escapes with the other. Pathaan and his team head to a lab to prepare a vaccine for the virus.

Jim calls them and reveals that the orb has already spread the virus in the lab. The infected scientists, along with Nandini, die in the lab by shooting themselves, and the lab is destroyed in a controlled blast to prevent the spread of the virus. Jim provides an ultimatum to evacuate Indian soldiers out of Kashmir within 24 hours. Pathaan interrogates Raafe about the location of the missile, and learns that the missile is situated in Afghanistan. By luring Jim’s soldiers into a trap, Pathaan and his team attack Jim’s base where Qadir is killed by Rubina before activating the missile, containing the virus. Pathaan chases after Jim with a jetpack, and they both crash land into a cabin overlooking a cliff.

Meanwhile, Rubina deactivates the missile, but finds that Raktbeej is not in the missile, but instead in a passenger-bound airplane, which is about to land in Delhi. She informs Pathaan, who finds that Jim has the detonator. Luthra calls the air traffic control to prevent the plane from landing in Delhi. In the cabin, Pathaan and Jim fight, as the cabin begins sliding off the cliff. Despite getting stabbed by Jim, Pathaan steals the detonator, deactivates Raktbeej and throws Jim out of the cabin, seemingly resulting in his death. Afterwards, Pathaan is reinstated into RAW and made as the head of JOCR, while Nandini is posthumously awarded for her bravery.

In a mid-credits scene, Pathaan and Tiger are seen pondering about retiring and suggesting young agents who can replace them, but eventually decide to keep fighting the threats themselves.