Oscar (voice of WILL SMITH) is a little fish at the bottom of the food chain who dreams of one day living in a penthouse at the top of the reef overlooking a Manhattan-style, underwater metropolis. In the meantime, he's employed at the local Whale Wash where he and others, such as Angie (voice of RENÉE ZELLWEGER) who's smitten with him, work for Mr. Sykes (voice of MARTIN SCORSESE). He's a fast-talking puffer fish who's getting the squeeze from shark mafioso Don Lino (voice of ROBERT DE NIRO). Accordingly, Sykes sends his two jellyfish goons, Ernie (voice of ZIGGY MARLEY) and Bernie (voice of DOUG E. DOUG), to get the $5,000 out of Oscar that he owes his boss.
At the same time, and when he's not trying to extract more clams from the likes of Sykes and others, Don Lindo is trying to groom his sons to take over the business one day. To his dismay, Lenny (voice of JACK BLACK) is nothing like his vicious brother Frankie (voice of MICHAEL IMPERIOLI), and unbeknownst to anyone else is a closet vegetarian.
The disparate groups of aquatic life come together when Frankie wants Lenny to eat Oscar who's been tied up and tortured by the jellyfish thugs. Following an accident where a dropped anchor kills Frankie, the jellyfish think Oscar did the deed and report that back to Sykes and others. Soon ace TV reporter Katie Current (voice of KATIE COURIC) is on the scene reporting that Oscar is a shark slayer, drawing the attention of gold digger Lola (voice of ANGELINA JOLIE).
After being consoled by fellow shark Don Feinberg (voice of PETER FALK) and his right-hand octopus, Luca (voice of VINCENT PASTORE), Don Lino vows to get revenge on Oscar. He's now living the high life thanks to his newfound reputation but must deal with living up to it, all while befriending Lenny and being oblivious to how Angie feels about him.