In 1967, U.S. Army volunteer Chris Taylor arrives in South Vietnam and is assigned to an infantry platoon of the 25th Infantry Division near the Cambodian border. The platoon is officially led by the young and inexperienced Lieutenant Wolfe, but in reality the soldiers defer to two of his older and more experienced subordinates: the hardened and cynical Staff Sergeant Robert "Bob" Barnes, and the more idealistic Sergeant Elias.
Taylor is immediately sent out with Barnes, Elias and veteran soldiers on a planned night ambush for a North Vietnamese army force. The NVA soldiers manage to get close to the sleeping Americans before a brief firefight ensues; Taylor's fellow new recruit Gardener is killed and Taylor himself lightly wounded. After his return from hospital, Taylor bonds with Elias and his circle of marijuana-smokers while remaining aloof from Barnes and his more hard-edged followers.
During a subsequent patrol, three men are killed by booby traps and unseen assailants. Already on edge, the platoon is further angered when they discover an enemy supply and weapons cache in a nearby village. Barnes, through a Vietnamese-speaking soldier, Lerner, aggressively interrogates the village chief about whether the villagers have been aiding the NVA, and cold-bloodedly shoots the chief's wife dead when she snaps back at him. Elias then arrives, getting into a physical altercation with Barnes over the killing before Wolfe breaks it up and orders the supplies destroyed and the village razed. Taylor later prevents a gang-rape of two girls by some of Barnes' men.
When the platoon returns to base, the veteran company commander Captain Harris declares that if he finds out that an illegal killing took place, a court-martial will ensue, leaving Barnes worried that Elias will testify against him. On their next patrol, the platoon is ambushed and pinned down in a firefight, in which numerous soldiers are wounded. More men are wounded when Lieutenant Wolfe accidentally directs an artillery strike onto his own unit before Barnes calls it off. Elias takes Taylor and two other men to intercept flanking enemy troops. Barnes orders the rest of the platoon to retreat and goes back into the jungle to find Elias' group. Barnes finds Elias alone and shoots him, then returns and tells Taylor that Elias was killed by the enemy. While the platoon is extracting via helicopter, they glimpse Elias, mortally wounded, emerging from the treeline and being chased by a group of North Vietnamese soldiers, who kill him. Taylor realizes that Barnes was responsible.
At the base, Taylor attempts to talk his group into fragging Barnes in retaliation when Barnes, having overheard them, enters the room and mocks them. Taylor assaults the intoxicated Barnes but is quickly overpowered. Barnes cuts Taylor near his eye with a push dagger before departing.
The platoon is sent back to the front line to maintain defensive positions, where Taylor shares a foxhole with Francis. That night, a major NVA assault occurs, and the defensive lines are broken. Much of the platoon, including Wolfe and most of Barnes' followers, are killed in the ensuing battle. During the attack, an NVA sapper, armed with explosives, destroys the battalion headquarters in a suicide attack. Now in command of the defense, Captain Harris orders his air support to expend all their remaining ordnance inside his perimeter. During the chaos, Taylor encounters Barnes, who is wounded and driven to insanity. Just as Barnes is about to kill Taylor, both men are knocked unconscious by an air strike.
Taylor regains consciousness the following morning, picks up an enemy Type 56 rifle, and finds Barnes, who orders Taylor to call a medic. Seeing that Taylor won't help, Barnes contemptuously tells Taylor to kill him; Taylor does so. Francis, who survived the battle unharmed, deliberately stabs himself in the leg and reminds Taylor that because they have been twice wounded, they can return home. Taylor waves goodbye to Rhah, the last remaining member of his “Underworld” marijuana gang and O’Neil, the last surviving officer is given control of 2nd platoon. Helicopters carry Francis and Taylor away as well as other wounded soldiers. Overwhelmed, Taylor sobs as he glares down at multiple craters full of corpses.