The movie is a parody of classic kung fu movies and features footage from the 1975 film Hu hao shuang xing. Most of the footage in the film is recycled with current actors superimposed into some of the scenes. A family eats dinner together one night in their hut somewhere in rural China (father is Ming Lo, mother is Peggy Lu). Their meal is interrupted by a mysterious man who swiftly kills all but an infant lying in a crib. When the baby (Alejandro Olazabal) is confirmed to be the 'Chosen One' the attacker, Master Pain (Leo Lee), tries to kill him. However, the baby fights back with surprising speed, strength, and agility, resulting in a comical fight scene.
Tired of running after and looking for the baby, Master Pain sets fire to the hut and leaves. The baby, however, breaks out of the hut and cries over the loss of his family before tumbling over the side of a steep hill. He lands at the feet of a passing peasant woman (Tori Tran) who picks him up and holds him tenderly, commenting how cute he is, before tossing him over the other side of the road where he continues to tumble downhill. The film's narrator explains how the Chosen One (Steve Oedekerk) eventually grew up in the wilderness, living with various creatures and fighting his way across the countryside. Accompanied by his pet dog, Chosen walked and sometimes drove in search of the man who killed his family, often meeting fierce foes with whom he must do battle with. The fights do nothing but prove his mastery and increase his skills, some of which are physically impossible. He makes his way to a settlement where he meets the ill and slightly deranged Sifu named Master Tang (Hui Lou Chen).
Chosen proves his identity to Tang by opening his mouth and revealing a separate being; a smiley face aptly named Tonguey. Master Tang explains that he was once told by his flatulent master that there would be a Chosen One and that his appearance would be of great significance. He agrees to continue Chosen's training much to the displeasure of student Wimp Lo (Chia Yung Liu) who was trained wrong on purpose and as a joke. His shoes squeak as he walks, matching his whiny voice.
Chosen also meets the beautiful Ling (Ling-Ling Hsieh) who displays shyness at first but quickly warms up to him. She also displays a verbal twitch and constantly cries out "wee-ooh" when speaking. Jealous of Chosen's natural and supernatural abilities, Wimp Lo challenges him to a fight but seems to be under the impression that the more he gets beat up, the better he is at fighting. Ling attempts to stop the fight, crying out that a child could defeat Wimp Lo, before a messenger runs into the fighting arena and announces that Master Pain has been seen entering town. Recognizing the man as the one who killed his family, Chosen goes into town in disguise to meet him.
There, he witnesses Master Pain's amazing skills as he showcases his resistance to pain, undergoing a brutal beating without flinching, even in the most sensitive of areas. Master Pain earns the support of the town's mayor and announces that he is to be henceforth known as 'Betty'. Eager to see if he possesses the same skills as Betty, Chosen employs a group of men to beat him up, until he tells them to stop. However, the pain is evident and Chosen is knocked unconscious.
When he wakes up, he's approached by a caped woman with one large breast who introduces herself as Whoa (Jennifer Tung). They briefly skirmish and she tells him that he possesses the supreme gift that will allow him to defeat Betty. However, she warns him that now is not the time to fight him and that Chosen must avoid the meadow where Betty keeps his sacred guardian, Moo Nieu. She then flies into a tree, gets stuck a moment, and disappears. Chosen sits down and suddenly recalls that Whoa wore a brooch similar to the one his mother used to wear.
The following day Chosen decides to set forth and fight Betty despite Whoa's warning. He asks Ling to tell him where Betty is but she refuses at first and requests that Chosen stay and live with her. Chosen becomes angry and implores Ling to reconsider; blaming the curlicues in her hair for temporarily distracting him. She finally tells him where Betty was last seen and bursts into tears. Chosen rolls his eyes and heads out, crossing through the very meadow Whoa warned him against and coming face to face with Betty's guardian; a Holstein cow. The cow rears up on its hind legs and fiercely attacks Chosen, using her udder to squirt bullets of milk in a scene parodying The Matrix. Chosen is finally able to gain the upper hand by grasping the cow's udder and milking her until she is completely empty, her body thin and withered, leaving her incapacitated. Chosen leaves the meadow the victor and continues until he reaches the top of a waterfall where Betty is swinging a chain.
Chosen calls out to him, vowing vengeance for his family's death, but is stopped by a man who reveals himself to be Ling's father (Chi Ma), uttering the familiar "wee-ooh". Betty attacks both men using his dreaded iron claw, injuring Chosen and mortally wounding Ling's father. Chosen and Ling's father are sent over the edge of the rocky waterfall followed closely by a whale. They both survive the fall and Chosen helps Ling's father back into town.
They meet Master Tang who immediately recognizes Ling's father as his old mentor, Master Doe. Master Doe is placed on bed rest and warns Tang that Chosen must not be discouraged by his defeat that day and should continue his training, for if Betty garners the help of the Evil Council he will be unstoppable. Despite using Neosporin and odd massaging methods, Tang is unable to save Master Doe and he dies that night. Ling is upset over the loss of her father and is comforted by Chosen. She gives him mixed signals about whether her grief can be quelled by romance but finally decides that she doesn't want Chosen to think she's a slut and gives him a hug instead. Master Tang confronts Betty the next day in town and declares that he will fight him for Chosen's honor. Betty prepares for the fight by getting one of his henchmen to play 'Baby Got Back' on his jukebox.
However, Tang's constant coughing renders him unable to continue the fight and he further infuriates Betty by calling him Sally. That night, Chosen walks alone into a field and consults the starry skies for help. His prayers are answered by the image of a large lion in the clouds named Mu Shu Fasa (Mu Shu Fasa) (in obvious parody to The Lion King). Mu Shu advises Chosen that he must find his place in the great circle of stuff and tells him to continue his training. He speaks in further riddles and tells Chosen that the answers he seeks will be in the stars above before disappearing into the night, reciting, "this is CNN".
The following morning Master Tang goes out into the nearby fields for a walk, singing about animal sounds. He is momentarily suspicious when bird calls erupt from the field, including one from Betty hiding in the tall grass saying, "I'm just a birdie too". Betty then ferociously attacks Tang with his iron claw. Meanwhile, Ling leaves the safety of the town in search of Chosen, followed closely by Betty's men.
She comes to a courtyard where she discovers two ventriloquists who have been hung by their feet before she is grabbed by Betty's men and brought to him. He demands to know where Chosen is but she refuses to tell him and escapes. Wimp Lo attempts to act the hero and runs off, pursued closely by Betty and his men. However, his 'plan' is short lived and he's quickly subdued by Betty's claw, his squeaky shoes deflating as he collapses.
Ling runs out to the fields where she sees Chosen in the distance. She calls to him and he begins to run to her, though he does not seem to make any headway. Before he can reach her, a net the size of his head is thrown onto him and he collapses to the ground. A short intermission ensues where the characters each advertise various theater treats as light music plays in the background. Back to Chosen, he struggles against the confines of the tiny net and forces himself to reverse time and the capture method. He runs backwards, freed, and stumbles across the body of Wimp Lo in the reeds. He hears moaning and, in sequence, comes across Tang, Ling, and his dog all wounded by Betty's attacks.
However, despite appearing to die each time he comes to them, they all miraculously recover. Thinking that Wimp Lo has perhaps done the same, Chosen returns to him only to find (off screen) a fly-ridden corpse. He vows to find a way to reverse the bad and wrong that Betty has wrought, dubbing the term 'badong' and claims that he will stand up for the opposite of such tyranny; 'gnodab'. He sets up training dummies in a courtyard and attempts to remove from each dummy two metal, triangular spikes on their chests, identical to the ones Betty has on his person; the source of his power.
However, each attempt is met with failure as the spikes are too smooth to pull. Chosen becomes overly distraught and frustrated. That night, Ling tries to help him. He holds out his hands, bloodied by the spike points, and watches as she pours first salt, then lemon juice, then pure liquid mercury out of a thermometer into his hands. She tells him to rub his hands in her hair, humming strangely, and then sets his hands on fire. This technique somehow allows Chosen to get a firm grip on the spikes and pull them out of the dummies. He thanks Ling, admitting that he first thought she was nothing but a psycho bitch.
Meanwhile, Betty rests in the mayor's office, showing off his magician skills by changing the mayor's clothing color and laughing about Chosen's apparent demise. However, a messenger comes and tells him that Chosen is still alive. Betty is then summoned by the Evil Council and goes to their lair to seek advice, speaking to them in a large, echoing room. Though the council's speech is indecipherable, Betty is pleased to hear that they will help him defeat Chosen. The next day Chosen contemplates the best way to attack Betty and gain enough time to remove the spikes simultaneously, despite Ling's constant assurance that he's ready to defeat him. Each attack gone over in his head leaves him vulnerable to a counterattack, but he has an idea. He goes to a store and purchases a pound of nuts from the shouting vendor who then calls someone on his cell phone, telling them about Chosen's departure.
Chosen walks to a tree and uses a nut to beckon a squirrel. Chosen goes to meet Betty in a temple and begin their fight. Betty's jukebox henchman begins playing music but Chosen alters the tune so that it plays 'Black Betty'. Their fight takes them outside to the courtyard where Chosen appears to have the upper hand. Betty summons the Evil Council for backup and they arrive from the sky in large, triangular spaceships and begin playing French music, to Chosen's disgust. Empowered by their energy beams, Betty renders Chosen helpless with paralyzing attacks. Partially unconscious, Chosen has a vision of Mu Shu Fasa and Whoa.
Mu Shu advises Chosen to open his mouth. When he does, Tonguey extends to amazing lengths and flies out towards the Evil Council's mother ship, latching out on one of the corners and spinning it out of control until it crashes. The rest of the armada flees in fear. Chosen's body glows brightly and he leaps from the ground and grabs Betty's pyramid spikes as Betty chest palms him away. But Chosen is successful in removing the spikes. As blood spurts from the holes where the spikes were, Betty stumbles to the ground, hurts his stomach, and dies. Chosen sits up and removes from inside his shirt a very flat squirrel with a hand imprint pressed into it.
He thanks the squirrel for providing a cushion against Betty's blow and fills the hand-sized cavity in the squirrel with nuts. The squirrel awkwardly runs off with its reward. Ling runs into the courtyard, flashing Chosen for a moment, and embraces him. Chosen returns home with her, triumphant.
The movie ends with sequences showing a possible sequel (not true) filled with even stranger adventures for Chosen and his friends. At the very end, we see Master Tang, still weak and lying in the field where Chosen left him, asking if anyone will come to his aid as an eagle pecks at his leg..