Mowgli, a young orphan boy, is found in a basket in the deep jungles of Madhya Pradesh, India. Bagheera, a black panther who discovers the baby, promptly takes him to a mother Indian Wolf who has just had cubs. She raises him along with her own cubs and Mowgli soon becomes well acquainted with jungle life. Mowgli is shown ten years later, playing with his wolf siblings.
One night, when the wolf tribe learns that Shere Khan, a man-eating Bengal tiger, has returned to the jungle, they realize that Mowgli must be taken to the "man village" for his own safety. Bagheera volunteers to escort him back.
They leave that very night, but Mowgli is determined to stay in the jungle. He and Bagheera rest in a tree for the night, when they meet Skunk and friends after they save Mowgli from Kaa, a hungry Indian Python. The next morning, Mowgli, Skunk and friends try to join the elephant patrol led by Colonel Hathi and his wife Winifred. Bagheera finds Mowgli and the others and they argue which results in Bagheera leaving Mowgli on his own. Mowgli and friends soon meet up with the laid-back, fun-loving sloth bear Baloo, who shows Mowgli the fun of having a care-free life and promises to raise Mowgli himself and never take him back to the Man-Village.
Mowgli now wants to stay in the jungle more than ever. Shortly afterwards, Baloo is tricked and outsmarted by a gang of monkeys who kidnap Mowgli and take him to their leader, King Louie the orangutan, who makes a deal with Mowgli that if he tells him the secret of making fire like a human, then he will make it so he can stay in the jungle. However, since he was not raised by humans, Mowgli does not know how to make fire. Bagheera, Baloo, Skunk and friends arrive to rescue Mowgli and in the ensuing chaos, King Louie's palace is demolished to rubble. Bagheera speaks to Baloo that night and convinces him that the jungle will never be safe for Mowgli so long as Shere Khan is there. In the morning, Baloo reluctantly explains to Mowgli that the man village is best for the boy, but Mowgli accuses him of breaking his promise and runs away. As Baloo, Skunk and the gang set off on foot in search of Mowgli, Bagheera, Fox and Rabbit rally the help of Hathi and his patrol to make a search party. However, Shere Khan himself, who was eavesdropping on Bagheera and Hathi's conversation, is now determined to hunt and kill Mowgli himself. Meanwhile, Skunk and Pig have found Mowgli and they’ve encountered Kaa once again in a different tree and the hungry python exacts his revenge by hypnotizing Mowgli again, along with his friends and tries to eat him, but thanks to the unwitting intervention of the suspicious Shere Khan, Mowgli, Skunk and Pig awaken again, trick the snake again, and escape.
As a storm gathers, a depressed Mowgli, along with Skunk and Pig encounter a group of puckish but friendly vultures who closely resemble The Beatles, and they agree to be his friends as they too are outcasts, and feel that everyone has to have friends. Shere Khan appears shortly after, scaring off the Vultures and confronting Mowgli. Baloo and the animals rush to the rescue and try to keep Shere Khan away from Mowgli, but Baloo is injured. When lightning strikes a nearby tree and sets it ablaze, the vultures and animals swoop in to distract Shere Khan while Mowgli gathers flaming branches and ties them to Shere Khan's tail. As fire is his only fear, the tiger panics and runs off.
Bagheera, Baloo, Skunk and friends take Mowgli to the edge of the Man-Village, but Mowgli is still hesitant to go there. His mind soon changes when he is smitten by a beautiful young girl from the village who is coming down by the riverside to fetch water. After noticing Mowgli, she "accidentally" drops her water pot, and Mowgli retrieves it for her and follows her into the man village. After Mowgli chooses to stay in the man village, Baloo and Bagheera decide to head home and Skunk and friends head off on another adventure, content that Mowgli is safe and happy with his own kind.