While their father Caractacus Potts is searching Coggin’s Garage for a part for one of his eccentric inventions, Jeremy and Jemima are playing out front in a broken-down old racing car. They pretend they are defeating the nasty Vulgarians in the 1910 British Grand Prix, one of many races this car famously won. As Coggins goes off to get the needed part, Potts joins his children in another imaginary race. They dream about restoring this car to its former glory.
Meanwhile in Vulgaria, the Baroness has promised the legendary car to her husband, the Baron, for his birthday. She telephones Boris and Goran, two bumbling Vulgarian spies who are in England, and orders them to find it.
Truly Scrumptious drives her motorcycle to Coggins’ Garage in search of a part and nearly runs into the old racing car. Potts offers to fix her motorcycle but Truly insists she does not need his help. She asks why his children are not in school and remarks on their eccentric upbringing. Potts seems put off by her assertiveness, but the children like her. After she leaves, a junkman offers to buy the old car from Coggins for 30 shillings, to Potts’ and his children’s alarm. Coggins agrees to sell the car to them instead if they can come up with the money. Boris and Goran, who have been spying on the garage and are excited to have found the car, set off to come up with the money themselves.
That evening, Grandpa joins Potts and the children in their windmill home for supper, which Potts prepares in his breakfast-making machine. Potts also shows Grandpa the sweet-making machine he has been working on. They discuss the difficulty of coming up with money for the car. Later, when Grandpa tries Pott’s latest candy invention he discovers that it makes a lovely sound. It toots! His son has invented something that works!
The next morning, Potts is full of hope that he can sell his whistling candy. He goes to the Sweet Factory to seek an interview with Lord Scrumptious, but he has no appointment and will not be let in. Then Truly, Lord Scrumptious’ daughter, arrives and escorts Potts and the children to her father. He demonstrates his invention—Toot Sweets, the eatable, tweetable treat! It is a success, until the whistling attracts packs of dogs into the factory.
Meanwhile, Boris and Goran have come up with 30 shillings and plan to disguise themselves to buy the car since they don’t think Coggins will sell it to two Vulgarians. And if they can’t buy it, they’ll steal it!
Back home, Jeremy and Jemima offer to sell their most precious keepsakes, such as a “stone that might be from Stonehenge,” to buy the car. Potts reassures them he has another invention to peddle to raise the 30 shillings. The next morning at the Fun Fair, Potts tries out his experimental haircutting machine, but nearly sets a customer’s head on fire. Fortunately, a turkey farmer purchases it for plucking and cooking turkeys.
Potts uses the money to buy the car and works on overhauling it in the garage. While his children excitedly wait, Grandpa regales them with tales of travelling the world. Potts finally brings out the rebuilt car. They name it Chitty Chitty Bang Bang after the sounds it makes when starting up. Boris and Goran, eavesdropping, mistakenly believe that Grandpa rather than Potts has refurbished the car. Potts, Jemima and Jeremy take their new friend Chitty on a drive in the countryside. Truly encounters them on her motorcycle, and they invite her along. While enjoying a picnic on the beach, Truly realizes her love for Potts and the children, and they in turn hope she will never leave them.
Jeremy notices the tide has come in, surrounding Chitty. A thunderstorm peals out along with cannon blasts—a Vulgarian ship, alerted by Boris and Goran, is firing on Chitty and demanding Potts surrender the car. Potts maneuvers his instruments and Chitty amazingly turns into a boat and floats off into the water where they elude the pursuing ship.
Boris telephones the Baron and Baroness in Vulgaria to report Chitty’s escape. Hearing that Chitty can travel on water, they are more determined than ever to capture it so they can learn the secrets of the car and make Vulgaria great once more. But upon hearing of children in the car, the Baroness faints—she can’t even bear the word, she loathes them so! The Baron calls in the dreaded Childcatcher to prepare for the arrival of Jeremy and Jemima.
Back in England, Boris and Goran kidnap Grandpa, whom they believe to be Chitty’s inventor, while he is in his outhouse. Using a blimp and large balloon, the outhouse is transported to Vulgaria. Potts, his children and Trudy pursue in Chitty. Reaching the coastal cliffs, Chitty surprises even Potts—she flies above the sea!
In the Vulgarian Town Square, the Baron and Baroness welcome Grandpa as “inventor extraordinaire.” Grandpa goes along with the mistaken identity. They introduce him to the Toymaker who makes the world’s best toys—toys for the Baron alone because, of course, children are forbidden in Vulgaria. The Baron provides Grandpa with assistants, brings out his own car and orders him to make it float and fly, just as Chitty does. If he fails, he will be made into a sausage.
Potts, Truly, Jeremy and Jemima arrive and see Grandpa locked up in the castle. The Toymaker hides them from the roaming Childcatcher. The Childcatcher can smell them and enters the toy shop but is unable to find them. Potts insists on rescuing Grandpa. The Toymaker offers to show him a secret way to the prison through the sewers where the Vulgarian children live hidden from the Childcatcher. Truly remains in the shop to guard Jeremy and Jemima. They are hungry, and Truly locks them in the shop while she goes in search of food. The Childcatcher returns and lures Jeremy and Jemima outside by posing as a candy seller. Truly returns to find them gone.
In the palace, the Baroness tells the Baron that for his birthday he will be receiving not only a flying car but a special toy promised by the Toymaker. Meanwhile, the Toymaker has brought Potts down into the sewers where the banished children survive on scraps stolen from the palace kitchens above. Truly arrives, revealing that Jemima and Jeremy have been imprisoned by the Childcatcher. Potts persuades all the children to join him in breaking into the palace to overthrow the Baron and Baroness, and free not only the captives, but themselves from their lives in the sewer.
The Baronial couple begins the birthday celebration. Summoning the guests, they order the Toymaker to present the gifts. He reveals two life-sized mechanical dolls and an enormous birthday cake. The dolls come to life—they are actually Truly and Potts in disguise—and the banished children burst from the cake and tie up the Baron and Baroness. The Childcatcher tries to capture the children, and a chaotic fight breaks out. Suddenly Chitty flies in, having rescued Grandpa, Jeremy and Jemima from prison. Mesmerized by the amazing machine, the Childcatcher is finally overpowered.
Truly and the Potts family celebrate their victory with the liberated children and Vulgarians. All are grateful to Chitty Chitty Bang Bang—their fine, four-fendered friend!
