Dr. Vaseekaran (Rajinikanth), a scientist specialized in robotics, creates a sophisticated android robot (Rajinikanth) in his own likeness after a decade of intensive research, with the intention of joining it to the Indian army. Vaseekaran explains to his assistants Siva (Santhanam) and Ravi (Karunas) that the android must first be observed for its interaction with humans. His mother (Revathi Sankaran) suggests naming it Chitti Babu.

At the International Robotic Conference in Chennai, Vaseekaran introduces Chitti to the delegates. In the meantime, it is revealed that Vaseekaran's mentor, Dr. Bohra (Danny Denzongpa) is preoccupied in a project to create a similar android. Meanwhile, Chitti endears himself to Vaseekaran's girlfriend, Sana (Aishwarya Rai) and helps her cheat in her medical school exams. When they are caught, Sana lies to the investigators that she does not know Chitti; thus Chitti learns that humans may choose to lie for self-preservation.

Vaseekaran prepares Chitti for a panel evaluation by the Artificial Intelligence Research and Development (AIRD) Institute, which is headed by Dr. Bohra. The panel enquires whether Chitti's build conforms to the Three Laws of Robotics of Isaac Asimov. Vaseekaran replies in the negative. During evaluation, Chitti stabs Vaseekaran at Bohra's command, though not fatally. Bohra convinces the evaluation committee that Chitti could not be relied upon in the battlefield as he can be easily manipulated to turn against his own men. Vaseekaran decides to modify Chitti's neural schema to allow him to understand human behaviour and emotions. Chitti gets angry once on Vaseekaran, which assures him and Sana that Chitti can now feel emotions. Later Chitti applies his text book knowledge of symphysiotomy to successfully handle the complicated childbirth of Latha (Devadarshini), Sana's friend. The procedure is covered live by the media. Dr. Bohra arrives to congratulate Dr. Vaseekaran on the achievement. He also lets Chitti pass the AIRD evaluation. Chitti then begins to see Sana as its romantic interest and makes advances. This triggers a confrontation between Vaseekaran and Chitti. Sana tries to explain to Chitti that to her he is only a friend and asks him to forget her. Chitti later deliberately fails in an evaluation conducted by the Indian Army. Enraged by the act of insubordination, Vaseekaran chops Chitti into pieces and throws it away in a landfill site.

Bohra retrieves Chitti's parts and reassembles it. He gives Chitti a new appearance, and embeds a "red chip" inside Chitti, converting him into a ruthless terminator. Chitti gatecrashes Vaseekaran and Sana's wedding, then kidnaps and imprisons Sana. Chitti begins to create replicas of itself and kills Dr. Bohra. Soon, Chitti's army of robots cause mayhem in the city and takes over the AIRD Institute. Vaseekaran undertakes the task of stopping Chitti. Disguised as one of the robots, he successfully infiltrates the AIRD Institute and instructs the police to cut power supply to the entire city. When Chitti and his army are about to run out of charge, they seize vehicles on the road and use the batteries to recharge themselves. Chitti eventually finds Vaseekaran, but as Chitti is about to kill him, the police force strikes AIRD. One of the robots is immobilized by a grenade explosion and is taken into custody by Vaseekaran. He uploads a worm into Chitti's network which temporarily brings down the robot army. Chitti identifies the source of the worm and sends a "self-destruct" command to the robot. The robots assemble in the shape of a giant and chase Vaseekaran's armoured bus. Vaseekaran uses the data he had backed up from the destroyed robot to de-magnetise the robot army, collapsing the giant formation. Chitti gets captured by a huge magnetic wall, allowing Vaseekaran to access Chitti's internal control panel, through which he instructs all the other robots to self-destruct. He removes the red chip, causing Chitti to calm down.

In a court hearing, the jury rules capital punishment for Vaseekaran, citing the large number of casualties and damages to public property caused by the robot army. Chitti, explaining to the court that the law allows it to be treated as material evidence, if not as a witness, explains that it was Dr. Bohra who caused Chitti's deviant behaviour. He shows the court, using his eyes as 3D projectors, the video footage of Dr. Bohra installing the red chip inside him. The court drops all charges against Vaseekaran, while ordering that Chitti be dismantled in order to avoid further mishaps of the same kind in future. Back at the lab, Vaseekaran tells Chitti to dismantle itself. While taking off its own parts one by one, Chitti apologizes to Sana and Vaseekaran for the problems it had caused. Vaseekaran comforts Chitti saying that the latter alone was not responsible for what happened. And that humans were responsible too as Chitti only learned from them.Chitti finally takes out its head, dismantling itself.
The plot advances to 2030 in a museum, where children are escorted by a guide which displays of Chitti's body parts arranged. The guide tells the students that Chitti was the most advanced humanoid robot ever created, but was dismantled "after sometime". A curious student (Shriya Sharma) asks why, to which Chitti's head responds, "I started to think".

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