Governor Swann (Jonathan Pryce), the new governor of Port Royal, Jamaica, and his young daughter Elizabeth (Keira Knightley) sail from England to the Caribbean on board the H.M.S. Dauntless. A young officer, Lieutenant Norrington (Jack Davenport) of the British Royal Navy is also aboard. They come upon a shipwreck with a sole survivor: a boy named Will Turner (Orlando Bloom). Elizabeth discovers a golden skull medallion around Will's neck and, fearing that he will be executed as a pirate, quickly hides it from the others. Elizabeth briefly glimpses another ship with shredded black sails vanishing into the mist.

Eight years later, Captain Norrington is being promoted to Commodore. Elizabeth attends the ceremony at her father's request. Norrington is in love with Elizabeth and just as he begins to propose to her on the battlements, she faints because of the tight bodice she was wearing, tumbling over the wall into the bay. Destitute pirate Captain Jack Sparrow (Johnny Depp), only just arrived in Port Royal, rescues Elizabeth from drowning. The skull medallion that Elizabeth is wearing around her neck emits a mysterious pulse through the water as she is sinking. After saving Elizabeth, the occupying British forces attempt to arrest Jack for piracy, for which he has been branded on the forearm by the East India Trading Company. Sparrow escapes and ducks into a blacksmith shop where he encounters Will Turner, who is now a blacksmith's apprentice. Will is also in love with Elizabeth, but due to his common rank, he hides his feelings for her. Following a swordfight with Turner, Sparrow is knocked unconscious by Will's employer (who slept, drunk, through the entire fight) and is arrested and jailed.

That night, Port Royal is besieged by the infamous ghost ship known as the Black Pearl - a black-sailed vessel crewed by vicious, bloodthirsty pirates, and captained by a man reputed to be "so evil that Hell itself spat him back out". The mysterious pulse that emanated from Elizabeth's medallion has "called" the Black Pearl. The pirates ransack Port Royal and kidnap Elizabeth (who hides her true identity by claiming her last name is Turner) who is in possession of the medallion. She invokes the right of parléz in order to be taken unharmed back to the ship to Captain Hector Barbossa (Geoffrey Rush). Elizabeth asks Barbossa to cease his attack on Port Royal in exchange for the medallion. Barbossa agrees but, employing a loophole in their agreements, abducts Elizabeth.

Having seen Elizabeth being taken by the pirates, Will implores Norrington to pursue the Black Pearl. Norrington refuses, so Will seeks help from Jack Sparrow. Will breaks Jack out of jail in exchange for assistance in rescuing Elizabeth. After commandeering the HMS Interceptor, the Royal Navy's fastest ship, and assembling a crew in the lawless town of Tortuga, Jack and Will set off to find Barbossa and the Black Pearl, which is heading towards Isla de Muerta, a mysterious island that is said to be undiscoverable, save for "those who already know where it is."

As Will, Jack, and their crew pursue the Black Pearl, the true story and intentions of Barbossa and his crew are revealed. The Black Pearl and its crew were once under the command of Captain Jack Sparrow. After Barbossa, the first mate, persuaded Jack into giving the crew the bearings to Isla de Muerta, the location of a chest of Aztec gold treasure they sought, the crew members mutinied. They marooned Jack on a small island, leaving him a pistol containing only one shot, presumably to put himself out of his misery. The crew found the Aztec treasure, and, believing the curse on the gold to be a myth, took all the treasure for themselves. Will's father, "Bootstrap Bill" Turner, was the only member of the crew who protested against the mutiny. Bootstrap Bill sent one of the cursed gold pieces away to his son in hopes that the crew would never find it and remain cursed as a fitting punishment for the mutiny, but in doing so accepted that the curse would befall him as well. In retaliation, Barbossa ordered Bootstrap to be tied to a cannon and thrown overboard. He was last seen, according to one of Barbossa's mates of The Black Pearl, Pintel, sinking into the depths.

Too late, the crew discovered that the curse was indeed real; their gluttony, greed, and lust for worldly possessions can never be satisfied, and they became undead, unable to die. Moonlight reveals that the pirates are living, rotting skeletons that cannot die from a mere gunshot or stab wound. In order to remove the curse, they must return all the pieces of the treasure to its chest and give a blood sacrifice from everyone who removed them. After a decade, they have succeeded in fulfilling almost all of the requirements to end the curse - save for obtaining the blood of Bootstrap Bill and the gold piece he stole. With the medallion (in reality, the last piece of the treasure) and Elizabeth (whom they believe is the daughter of Bootstrap Turner) in custody, Barbossa believes he finally has what he needs to lift the curse.

Just after the Pearl's crew tries - unsuccessfully - to lift the curse, Will and Elizabeth escape in a boat after sabotaging the others and leaving Jack behind (in keeping with the pirate's code, which says "any man who falls behind is left behind"). When Barbossa and the crew discover Jack still on the isle, Jack offers to trade information on the person whose blood will lift the curse (i.e. Will) in exchange for his return as Captain of the Black Pearl. Jack's negotiations come to naught when the Pearl manages to catch up to the fleeing Interceptor and the crew boards her. Will is trapped below deck while trying to get the medallion. Jack escapes and tries to recover the medallion, but it is taken instead by Barbossa's pet monkey who is also named Jack. Successful in their mission, the Pearl's crew takes the Interceptor's crew- including Elizabeth -captive and destroys the ship, seemingly with Will on board.

Even as Elizabeth begins to mourn, Will climbs aboard the Pearl and reveals himself to the crew as the true offspring of Bootstrap Bill. Elizabeth and Jack are stranded on the same island on which Jack was stranded a decade ago, while Will is taken back for his blood to be shed to complete the requirements to end the curse. Elizabeth burns a cache of rum left by rumrunners, as well as some of the small island's palm trees, to create a signal fire to alert Norrington of her location. Elizabeth and Jack are soon rescued by Norrington. When Norrington refuses to go after the Black Pearl to save Will, Elizabeth implores him to do it for her, as a wedding gift. Norrington agrees.

Upon arriving at the cursed island, Jack convinces Norrington's forces to lie in ambush for Barbossa's crew while he goes in and convinces them to come out. He convinces Barbossa to delay spilling Will's blood to break the curse until after they have killed the crew of the HMS Dauntless and taken the ship. This proves to all be part of Jack's plan; however, he was not expecting the undead crew to walk along the ocean floor to the ship, which allows them to escape the planned ambush. As the Black Pearl crew engages the Royal Navy in hand-to-hand combat aboard the Dauntless, Jack steals one of the cursed coins and engages in his own swordfight with Barbossa, his former first mate. Because he stole one of the coins, Jack too is now cursed and thus can't be killed until the curse is lifted. Moreover, in order for the curse to be lifted, his blood must now also be given. During their fight, he distracts Barbossa long enough until both he and Will can give their blood and return their respective coins (Will has Elizabeth's medallion, Jack the coin he recently stole). Before Will drops the coins into the chest, Jack shoots Barbossa with his pistol, containing the one shot he was given when marooned after Barbossa's mutiny. When Barbossa claims, "Ten years you carry that pistol and now you waste your shot." Will claims, "He didn't waste it!" and drops the coins into the chest breaking the curse. After the curse ends and all the Black Pearl crew becomes mortal again, Barbossa falls to the treasure-covered ground and drops his sour, green apple. After realizing that they are no longer cursed - and now mortal - Barbossa's crew surrenders to the Royal Navy.

Back at Port Royal, Norrington prepares to hang Jack as per law, but Will, who believes him decent enough a man not to deserve death, rescues Jack. Elizabeth, inspired by Will's sudden defiance, as well as his confession of love towards her, declines marriage to Norrington and declares her feelings for Will instead. Norrington agrees to release her from her promise and Will is pardoned for his criminal act; meanwhile, Jack escapes and awkwardly falls into the ocean, to be rescued by his crew, which now man the Black Pearl. Norrington watches as Jack sets sail for unknown adventure, impressed by the pirate enough to allow him two days' head start before setting out in pursuit.

Following the end credits, in a final scene on Isla de Muerta, Barbossa's pet monkey, Jack, climbs out of the water and onto the Aztec chest, where he takes a piece of the treasure. Jack's skin sloughs off and the now cursed monkey glares straight ahead for a moment before pouncing forward, the scene disappearing into his mouth. This explains why Jack the monkey is still cursed in Dead Man's Chest.