In an alternate 1985, tension between the United States and the Soviet Union pushes the world to the brink of nuclear war. The existence of costumed heroes, or "Watchmen," who once operated as vigilantes but have since been banned, adds a complex layer to the geopolitical landscape. The film begins with the murder of Edward Blake, also known as The Comedian, a former Watchman. His death provokes Rorschach, a fellow masked vigilante, to investigate what he believes is a targeted strike against their kind. He warns his former comrades—Dan Dreiberg (Nite Owl), Laurie Jupiter (Silk Spectre), Dr. Manhattan, and Adrian Veidt (Ozymandias)—of a possible conspiracy.

As Rorschach digs deeper, the narrative explores the backstories and psychological profiles of these flawed heroes. Dr. Manhattan, a god-like being with immense power, becomes increasingly detached from humanity, while Laurie's complicated relationship with him intensifies. Dan Dreiberg struggles with his longing for the days of vigilantism and begins re-engaging with his alter ego, Nite Owl. Meanwhile, Adrian Veidt, the smartest man on Earth, runs a successful business empire while harboring his own intentions for peace. As the truth about Blake’s murder starts to unfold, the stakes grow higher, leading to revelations that profoundly affect the fate of the world.