It's 1936 and Indiana Jones (HARRISON FORD) is a college professor who moonlights as an adventurous archaeologist, globetrotting around the world in search of ancient artifacts. His latest such attempt was thwarted by his chief competitor and adversary, Belloq (PAUL FREEMAN). Now back at school, his friend and administrator Marcus Brody (DENHOLM ELLIOT) informs Indiana that some government men are interested in him due to his status of being a professor of archaeology, expert on the occult, and obtainer of great antiquities.
It seems that the Nazis are in search of the Ark of the Covenant, in which The Ten Commandments were contained. It supposedly possesses great powers, and the U.S. Government doesn't want them to get their hands on it. Accordingly, Indiana sets off to find it, knowing that his only lead might come from an old acquaintance, Professor Ravenwood. Arriving in Nepal, Indiana discovers that the professor is dead, but that his daughter, Marion (KAREN ALLEN) -- with whom Indy had some sort of romantic past -- is still alive and as feisty as ever.
When Nazi official Toht (RONALD LACEY) and his men interrupt their tenuous reunion and burn down her bar, she becomes his partner in their quest to find the Ark. The two then travel to Cairo where they meet Indy's old friend Sallah (JOHN RHYS-DAVIES) and the three then set out to find the Ark's resting place, unaware that the Nazis have hired Belloq to do the same. As they get closer to finding the religious artifact, the three must not only contend with the competing crew, but also Toht and the other Nazis who want them dead.