The film opens in the mountain cabin of one Dr. Hunter S. Thompson (Bill Murray), gonzo journalist extraordinaire. He is holed up with his dog Bronco and a plethora of alcohol and drugs, struggling with a looming deadline to produce a magazine article about his eccentric former attorney, Carl Lazlo, Esq. (Peter Boyle). When his fax machine begins beeping with a call from his publisher, he angrily shoots it with one of his many guns (in this case, a. 45 revolver); he then "get[s] a grip" and sits down to his typewriter.
His voice-over narration reflects what he writes, as it does throughout the film. Fade to 1968, early in Thompson's career. He is holed up on an upper-story hospital room with a loud stereo, a pack of drugs and alcohol, and a nubile student nurse (Sunny Johnson). A nurse explains to a doctor that he arrived there claiming to have been chased by Richard Nixon and attacked by a swarm of bats. At this point, Lazlo, a wild-haired, mustachioed liberal attorney, arrives. Finding Thompson's room barricaded from the inside, he calmly walks through the neighboring (and occupied) room and, after helping himself to some of the patients' pills, climbs out onto the balcony and bursts into Thompson's room from the window. This sends Thompson's drugged-out companion into a nearly-catatonic state (she believes Lazlo to be a giant bat), but Lazlo remains calm as he offers his legal advice to Thompson and eats some food.
(Lazlo eating some of Thompson's food is a running theme of the film and suggests that he [Lazlo] is not above sponging off those around him. ) As the hospital staff begins to break down the door, Thompson and Lazlo unhurriedly escape and miraculously get down to Lazlo's car and escape just as the doctors and nurses break in. On the road, Thompson simultaneously drives and types Lazlo's running commentary about the sorry state of America's legal system, vis-a-vis their treatment of teenagers on drug charges. They arrive at the courthouse where Lazlo is about to go before a judge to defend a large group of kids who, in various combinations, have all been arrested for possession of marijuana.
He insists on taking all the cases to bench trial, which serves only to irritate the judge and district attorney; all the defendants receive very harsh penalties. After one such outrage, when a teenager is given five years for possession of a joint, Lazlo reacts violently and ends up throwing the district attorney over the judge's bench. As the court is hurriedly cleared and Thompson struggles to snap pictures, Lazlo screams at him to "tell the world" what happened. Back at BLAST Magazine headquarters, Thompson's beleagured publisher Marty (Bruno Kirby) paces back and forth waiting for Thompson to deliver his story.
Presently Thompson arrives, but teases Marty for a while before finally giving up the story in exchange for the cheque. Thompson's voice-over comes back in as we see Lazlo languishing in a jail cell with one of his defendants. Los Angeles, 1972; in voice-over, Thompson explains that Lazlo quit the legal system and dropped out of sight, and as the 60s ended many counterculturalists, in Thompson's words, "got off the boat," but not everyone did, including Lazlo, Nixon, and himself. Now a successful and popular writer, Thompson is in town covering Super Bowl VI (this is an error, as the 1972 Super Bowl was actually held in New Orleans). He arrives at his hotel in a hallucinogenic state, mildly assaulting his driver before remembering where he is and what he is doing. At the front desk, he terrorizes the clerk by ordering large amounts of electronic equipment and food (including 16 grapefruit), and proceeds to turn his room into a slightly grotesque piece of modern art, complete with toilet paper and variously-placed fruit. When the hotel staff comes to quiet him down (as requested by a professional gambler [Leonard Gaines] who "needs a super rest" for the game), they are sucked into his world and willingly take the marijuana and alcohol he provides.
The next morning, Thompson is sitting in the hotel restaurant, eating a huge breakfast and listening to his tape recorder. His recording from when he awoke says that he did so to find that the hotel employees had broken in, drank all his liquor, did all his drugs, and stole his dinner. At the entrance, the aforementioned gambler is speaking on the phone with an associate, bemoaning his sleepless night; just then Lazlo appears wearing a Nixon mask, which prompts the gambler to give up on the game and go home to escape the "nuthouse. " Lazlo sits down at Thompson's table, gives him the mask as a present, and then persuades him to give up on the Super Bowl story and go with him to some unknown destination. Outside, Thompson gives his tickets, press pass, and room key to two random guys, and they set off.
On the road, Lazlo talks about where he has been the past four years; namely, becoming enlightened. He now is actively trying to promote world revolution, and he does this with a small band of weirdos by smuggling weapons to revolutionaries in impoverished countries. At the ranch, Thompson quickly sees the futility of what Lazlo is doing but comes with him anyway to a rendezvous at a isolated airfield, where Lazlo's group will load up a plane with guns and fly it away. At the airstrip, however, a police helicopter arrives and begins to descend; Lazlo and his group escape in the loaded plane, but Thompson refuses to follow, and the police follow the copter. Later in 1972, Thompson is covering the presidential campaign, but takes some time to appear at a university for a Q&A with the students. The hall is packed and he is very late, and needs to be coaxed quite a bit by the event coordinator to even go on at all, but eventually goes out and wows the crowd with his eccentric views and answers.
One student asks about Lazlo and puts forth the idea that he never really existed; Thompson responds that he was real, but he was now believed dead. Back on the campaign trail, he gets on the press plane that follows Richard Nixon (referred to only as "the candidate") around. He stands out starkly from the rest of the buttoned-down reporters, dressed in Bermuda shorts, a loud Hawaiian shirt, and a maroon sports jacket. Onboard, he frightens the young reporter next to him (Michael Cornelison) by producing an enormous hunting knife to slice his grapefruit ("They never search me"), then by speaking into his tape recorder about being divebombed by poisonous ravens on his way to catch the plane.
Just then, the candidate's aide Dooley (Mark Metcalf) comes in and throws Thompson off the plane, demanding that he fly on the "zoo" plane with the technicians. The zoo plane is considerably different than the straight-laced reporter plane; the people are all hippies and drugs and alcohol flow freely (even amongst the crew). Also onboard this flight, though, is another reporter, Harris from the Post (Rene Auberjonois), due to overcrowding on the other plane. He sits down next to Thompson and tries to settle down to work, but the loud noise and constant physical distress drive him to distraction. That is, until Thompson produces some "headache pills," his blue ones; Harris takes two, and within an hour he is in the grip of Thompson's powerful hallucinogens.
By the time the plane lands, Thompson has switched their clothes and infiltrates the reporter entourage by posing as Harris. As he washes up in the bathroom, Thompson gets a surprise visitor: Nixon himself (Richard M. Dixon, but voiced by Brian Cummings) comes in to relieve himself. Thompson launches into a tirade that the country is divided into the "Screwheads" and the "Doomed," who live in fear of the Screwheads. He asks Nixon what the country is doing for the Doomed, to which Nixon replies, "Fuck the doomed!"Back aboard the reporter plane, on which Thompson has reappeared disguised as Harris, he suddenly spots none other than Lazlo walking across the tarmac, wearing a three-piece white suit. Realizing that the appearance of Lazlo will destroy his chance of continuing on the campaign trail, he hurriedly invites the same young reporter that he terrorized before (who does not recognize him in his disguise) to sit in his row and tell Lazlo that the seat between them is taken.
He does so when Lazlo boards, but Lazlo ignores him and sits down next to Thompson. He begins telling him, in an increasingly excited and loud voice, about his new plan: to buy land in the middle of the desert and build a socialist paradise. At this point Dooley arrives and, fed up with Thompson, promptly throws him off the plane for good; when he insults Lazlo, Thompson punches him in the face and the two escape while Thompson holds the reporters and Secret Service at bay with a fire extinguisher (he gets a good shot in on Nixon when the candidate pokes his head out of his door for a moment). On the runway, Thompson watches as the plane takes off and tells Lazlo that he won't help him with his project, because Lazlo is "insane, a raving maniac. "Back in the present at his ranch, Thompson finishes the story and sits down next to his dog to read him the end.
Reading, he speaks of how Lazlo and Nixon were both gone (the latter being eaten by white cannibals on an island near Tijuana), and that he, Thompson, got out because, through it all, it never got weird enough for him..