MI6 agent James Bond is sent to Siberia to locate the body of 003 and recover a microchip originating from the Soviet Union. Upon his return Q analyses the microchip, establishing it to be a copy of one designed to withstand an electromagnetic pulse and made by government contractor Zorin Industries.
Bond visits Ascot Racecourse to observe the company's owner, Max Zorin. Zorin's horse wins a race but proves hard to control. Sir Godfrey Tibbett, a racehorse trainer and MI6 agent, believes Zorin's horse was drugged, although tests proved negative. Through Tibbett, Bond meets French private detective Achille Aubergine who informs Bond that Zorin is holding a horse sale later in the month. During their dinner at the Eiffel Tower, Aubergine is assassinated by Zorin's bodyguard May Day, who subsequently escapes, despite being chased by Bond.
Bond and Tibbett travel to Zorin's estate for the horse sale. Bond is puzzled by a woman who rebuffs him and finds out that Zorin has written her a cheque for $5 million. At night, Bond and Tibbett break into Zorin's laboratory learning that he is implanting adrenaline-releasing devices in his horses. Zorin identifies Bond as an agent, has May Day assassinate Tibbett and attempts to have Bond killed too.
General Gogol of the KGB confronts Zorin for killing Bond without permission revealing that Zorin was initially trained and financed by the KGB, but has now gone rogue. Later, Zorin unveils to a group of investors his plan to destroy Silicon Valley which will give him—and the potential investors—a monopoly over microchip manufacture.
Bond goes to San Francisco where he learns from CIA agent Chuck Lee that Zorin could be the product of medical experimentation with steroids performed by a Nazi scientist, now Zorin's physician Dr. Carl Mortner. He then investigates a nearby oil rig owned by Zorin and while there finds KGB agent Pola Ivanova recording conversations and her partner placing explosives on the rig. Ivanova's partner is caught and killed, but Ivanova and Bond escape. Later Ivanova takes the recording, but finds that Bond had switched tapes, leaving her with a recording of Japanese music. Bond tracks down the woman Zorin attempted to pay off, State Geologist Stacey Sutton, and discovers that Zorin is trying to buy her family oil business.
The two travel to San Francisco City Hall to check Zorin's submitted plans. However, Zorin is alerted to their presence and arrives, killing the Chief Geologist with Bond's gun and setting fire to the building in order to both frame Bond for the murder and kill him at the same time. Bond and Sutton escape from the fire, but when the police try to arrest Bond, they escape in a fire engine.
Bond and Sutton infiltrate Zorin's mine, discovering his plot to detonate explosives beneath the lakes along the Hayward and San Andreas faults, which will cause them to flood, resulting in Silicon Valley and everything within to be submerged underwater forever. A larger bomb is also in the mine to destroy a "geological lock" that prevents the two faults from moving at the same time. Once in place, Zorin and his security chief Scarpine flood the mines and kill the mine workers. Sutton escapes while Bond fights May Day; when she realises Zorin abandoned her, she helps Bond remove the larger bomb, putting the device onto a handcar and pushing it out of the mine, where it explodes, killing her.
Zorin, who had escaped in his airship with Scarpine and Mortner, abducts Sutton as Bond grabs hold of the airship's mooring rope. Zorin tries to kill Bond, but he manages to moor the airship to the framework of the Golden Gate Bridge. Sutton attacks Zorin and in the fracas, Mortner and Scarpine are temporarily knocked out. Sutton flees and joins Bond out on the bridge, but Zorin follows them out with an axe. The ensuing fight culminates with Zorin falling to his death, whereupon Mortner attacks Bond using sticks of dynamite, but drops a stick in the cabin, blowing up the airship and killing himself and Scarpine. General Gogol awards Bond the Order of Lenin for foiling Zorin's scheme.