12-year-old Dre Parker (Jaden Smith) and his mother, Sherry (Taraji P. Henson) move to Beijing from West Detroit after she gets a transfer in her car factory job. Dre develops a crush on a young violinist, Mei Ying (Wenwen Han), who reciprocates his attention, but Cheng (Zhenwei Wang), a kung fu prodigy whose family is close to Mei Ying's, attempts to keep them apart by beating Dre, and later proceeds to bully him in and around school. After a field trip to the Forbidden City, Dre encounters Cheng and his friends hanging out close to his apartment. Dre tries to pass by without them seeing him. When he finds a bucket of polluted water, Dre gets revenge by splashing the water around Cheng and his friends. Cheng and the others pursue and catch Dre, beating him. During the brutal attack, the enigmatic maintenance man of Dre's building, Mr. Han (Jackie Chan), comes to Dre's aid, revealing himself as a kung fu master who dispatches Dre's tormentors.
After Han mends Dre's injuries using fire cupping, Dre asks if Mr. Han could teach him Kung-Fu. Han refuses, but decides to meet Cheng's teacher, Master Li (Yu Rongguang), to make peace. Li, who teaches his students to show no mercy to their enemies, challenges Dre to a fight with Cheng. When Han declines, Li says they will not be allowed to leave his school unless Dre or Han fights. Han acquiesces, but insists the fight take place at an upcoming tournament, and that Li's students leave Dre alone until the tournament. Li agrees, but tells Han that if Dre does not show up during the tournament he will personally bring pain to Han and Dre.
Dre is shocked when Han tells him that he will fight in a kung fu tournament. Han promises to teach Dre real kung fu. Han begins training Dre, but Dre is frustrated that Han merely has Dre spend hours taking off his jacket, hanging it up, dropping it, and then putting it back on again. After days of this, Dre refuses to continue until Han demonstrates that the repetitive arm movements were Han's method of teaching Dre martial arts techniques, which Dre displays instinctively when prompted by Han's mock attacks. Han emphasizes that the movements Dre is learning apply to life in general, and that serenity and maturity, not punches and power, are the true keys to mastering the martial arts. During one lesson in the Wudang Mountains, Dre notices a female kung fu practitioner apparently copying the movements of a cobra before her, but Han informs him that it was the cobra that was imitating the woman, as in a mirror reflection. Dre wants Han to teach him this technique, which includes linking Han's hand and feet to Dre's via bamboo shafts while practicing their forms, but Dre's subsequent attempt to use this reflection technique on his Mom is unsuccessful.
As Dre's friendship with Mei Ying continues, Dre persuades Mei Ying to cut school for a day of fun, but when she is nearly late for her violin recital her parents deem him a bad influence and forbid her from spending more time with him. When Dre finds Han drunk,despondent and breaking the car he had in his living room, Dre learns that it is the anniversary of Han's wife and son's deaths, which occurred when he lost control of the car due to anger caused from an argument he was having with his wife. Dre reminds Han that one of his lessons was in perseverance, and that Han needs to heal from his loss. Han assists Dre in reading a note of apology to Mei Ying's father in Chinese; he accepts and promises that he and Mei will attend the tournament to support Dre.
At the tournament, the under-confident Dre is slow to achieve parity with his opponents, but soon begins beating them and advances to the semifinals, as does Cheng, who violently finishes off his opponents. Dre comes up against Liang, another of Li's students, who is instructed by Li to injure Dre's leg. When Liang insists that he can beat Dre, Li sternly tells him that he does not want him beaten, but broken. Although Liang is disqualified for his illegal strikes, Dre is incapacitated.
Despite Han's insistence that he has earned respect for his performance in the tournament, Dre convinces Han to mend his leg by using fire cupping in order to continue the tournament. Dre returns to the arena, facing Cheng. Dre delivers impressive blows, but Cheng counters with a strike to Dre's injured leg. Dre struggles to get up, and attempts the reflection technique to manipulate Cheng's movements. Cheng charges Dre, but Dre flips and catches Cheng with a kick to his head, winning the tournament along with the respect of Cheng and his classmates. After this, Cheng awards Dre the trophey, instead of the presenter, with a smile which signifies to Dre that he need not be scared anymore.
