In 180 AD, Hispano-Roman General Maximus Decimus Meridius intends to return home after he leads the Roman army to victory against the Germanic tribes near Vindobona on the Limes Germanicus. Emperor Marcus Aurelius tells Maximus that his own son, Commodus, is unfit to rule and that he wishes Maximus to succeed him, as regent, to help save Rome from corruption and restore the republic. Upon hearing this, Commodus murders his father.

Commodus proclaims himself the new emperor, asking Maximus for his loyalty, but the latter refuses. Maximus is arrested by the Praetorian Guard and is told that he and his family will die. He kills his captors and, wounded, he rides for his home near Trujillo, only to find his wife and son crucified. Maximus buries them, then collapses from his injuries. Slavers find him, and take him to the city of Zucchabar in the Roman province of Mauretania Caesariensis, where he is sold to gladiator trainer Proximo.

Maximus reluctantly fights in local tournaments, his combat skills helping him win matches and gain popularity. He befriends two other gladiators: Hagen, a German; and Juba, a Numidian. Hagen relates he fought with Maximus in Germania, while Juba encourages him that he will meet his wife and daughter in the afterlife. Proximo reveals to Maximus that he was once a gladiator who was freed by Marcus Aurelius, and advises him to "win the crowd" to win his freedom.

When Commodus organises 150 days of games to commemorate his father's death, Proximo takes his gladiators to Rome to fight in the Colosseum. Disguised in a masked helmet, Maximus debuts in the Colosseum as a Carthaginian in a re-enactment of the Battle of Zama. Unexpectedly, he leads his side to victory, and Commodus enters the Colosseum to offer his congratulations. He orders the disguised Maximus, as leader of the gladiators, to reveal his true identity; Maximus removes his helmet and declares vengeance. Commodus is compelled by the crowd to let the gladiators live, and his guards are held back from striking them down.

Maximus's next fight is against a legendary undefeated gladiator, Tigris of Gaul. Commodus has arranged for several tigers to be set upon Maximus during the duel; Maximus, however, prevails. Commodus orders Maximus to kill Tigris, but Maximus spares his opponent's life; to that the crowd chants "Maximus the Merciful". Angered at this outcome, Commodus taunts Maximus about his family's deaths, but the latter turns and walks away.

Maximus discovers from Cicero, his ex-orderly, that his former legions remain loyal. He meets in secret with Lucilla, Commodus's sister and once the lover of Maximus; and Gracchus, an influential senator. They agree to have Maximus escape Rome to join his legions, topple Commodus by force, and hand power back to the Roman Senate. Commodus learns of the plot when Lucilla's son, Lucius, innocently hints at the conspiracy. Commodus threatens Lucilla and Lucius, and has the Praetorian Guard arrest Gracchus and attack the gladiators' barracks. Proximo and his men, including Hagen, sacrifice themselves to enable Maximus to escape. Maximus is captured at the rendezvous with Cicero, where the latter is killed.