Pongo is a dalmatian that lives in a London bachelor flat with his owner, professional songwriter Roger Radcliffe. Bored with bachelor life, unlike Roger who spends his days writing music, Pongo decides to find a wife for Roger and a mate for himself. While watching various female dog-human pairs out the window, he spots the perfect couple, a woman named Anita and her female dalmatian, Perdita (or Perdy for short) heading to Regent's Park. He quickly gets Roger out of the house and drags him through the park to arrange a meeting. After an awkward and unusual meeting that goes awry, Pongo's efforts pay off and had accidentally caused both Roger and Anita to fall into a pond, but it works out well as they fall in love. Both couples marry.
Once Roger and Anita (and Pongo and Perdita) get married, Perdita gives birth to a litter of puppies. One appears to be stillborn, but Roger is able to revive it by rubbing it in a towel (because of which, they name it "Lucky"). That same night, they are visited by Cruella De Vil, an eccentric and wealthy social parasite known to Anita from their school years. She offers the Radcliffes to buy the entire litter for a large sum, but Roger says they are not selling any of them. Weeks later, she hires Jasper and Horace to kidnap them all. The humans try every effort to locate them but to no avail. When Scotland Yard is unable to prove she stole them or find them, Pongo and Perdita use the "Twilight Bark", normally a canine gossip line, to alert and ask for help from the other dogs in London to locate them. The first one to answer the call is the Great Dane.
Colonel, an old sheepdog, along with his compatriots Captain, a gray horse, and Sergeant Tibbs, a tabby cat, find the puppies in a place called Hell Hall (aka The De Vil Place), along with others that Cruella had purchased from various dog stores. Tibbs learns they are going to be made into dog-skin fur coats and Colonel quickly sends word back to London. Upon receiving the message, Pongo and Perdita immediately leave to retrieve their puppies. Meanwhile, Tibbs overhears Cruella ordering Jasper and Horace to kill and render them that night out of fear the police will soon find them. In response, Tibbs attempts to rescue them himself while Jasper and Horace are watching the television, but they finish their show and come for them before Tibbs can get them out of the house. Pongo and Perdita burst through a window just as Jasper and Horace have cornered them and are about to kill them. Horace is knocked into the fireplace and Jasper gets his pants pulled down while Colonel and Tibbs guide the puppies from the house.
After a happy reunion with their own puppies, Pongo and Perdita realize there are 84 others with them in Cruella's possession. Shocked after learning of her plans, Pongo and Perdita decide to adopt them all, certain that Roger and Anita would never reject them. They begin making their way back to London, aided by other animals along the way; including the Collie and the cows who give them shelter and food. However, Cruella, Jasper, and Horace are in hot pursuit of them and will stop at nothing to catch them. In order to try and fool them, they cover themselves with soot so they appear to be Labrador retrievers.
They then pile inside a moving van going back to London. As it is leaving, melting snow cleans off the soot and Cruella, Jasper, and Horace see them through their disguises. In a maniacal rage, Jasper and Horace in their truck and Cruella in her car follow the van with the dogs inside. Cruella repeatedly rams it off the road (promptly damaging her car in the process), while Jasper and Horace try to cut it off from another direction. They nearly succeed, but just as they are about to do so, a panicked Horace accidentally tears the steering wheel from the truck's dashboard, causing the vehicle to swerve out of control. Because of this, they end up colliding with Cruella and her car, sending both vehicles crashing into a deep ravine. Comically, they are shown and well among the wreckage of their demolished vehicles. As Cruella screams in anger and frustration and berates Jasper and Horace for ruining everything, she begins weeping over the loss of her dear car and her dream coat, as the van drives away.
Back in London, Roger and Anita are attempting to celebrate Christmas and Roger's first big hit, a song about Cruella, but they miss their canine friends. Suddenly, barking is heard outside and after their nanny opens the door, the house is filled with dogs. After wiping away more of the soot, they are delighted to realize the dalmatian clan has returned home. They decide to use the money from the song to buy a large house in the country so they can keep all 101 dalmatians.