Forster, security chief for real estate developer Daniel Clamp, visits Mr. Wing’s curiosity shop in New York City’s Chinatown and reminds the owner that by refusing to sell his property, he is holding up the new Clamp Chinatown Centre. Mr. Wing insists that he is staying put. However, when Mr. Wing dies six weeks later, Clamp grabs the property and tears down the shop, forcing Mr. Wing’s pet mogwai, a furry little creature named “Gizmo,” to flee the building. The moment Gizmo reaches the sidewalk, he is captured by Lewis, a technician at Slices of Life, Inc., a genetic research laboratory in the Clamp Premiere Regency Trade Centre and Retail Concourse, better known as Clamp Centre, in mid-town Manhattan. Meanwhile, Billy Peltzer and Kate Beringer, formerly of Kingston Falls, arrive at Clamp Centre, where he is a graphic artist and she is a building tour guide. Security chief Forster, accompanied by Billy’s supervisor, Marla Bloodstone, admonishes Billy for having an unauthorized potted plant on his desk. Billy visits his friend, “Grandpa Fred,” who wears Dracula makeup and hosts horror films for the Clamp Cable Network, housed in the Centre. Fred mentions to Billy that a genetics lab is located on the 51st floor. At that moment, Bob, an employee of the City Delivery Service, brings a package to the Splice of Life laboratory’s receptionist. He hears a strange, melodious trill nearby as she signs for the package. Inside the lab, Lewis and his twin brother, Martin, show Gizmo to their boss, Dr. Catheter. Intrigued with the mogwai’s genetic possibilities, Dr. Catheter suggests that Gizmo be used in experiments. Many stories below, as Bob delivers a package to Billy’s office, he unconsciously whistles the tune he heard at Slices of Life. Recognizing Gizmo’s song, Billy asks Bob where he heard it, and Bob identifies the laboratory on the 51st floor. Billy goes up to Slices of Life with a repair kit under the guise he was called to fix the copy machine. In the lab, Billy sees Gizmo, his boyhood pet in Kingston Falls, and spirits the mogwai past the receptionist. Hiding Gizmo in an office file, Billy promises to take him home at quitting time. Suddenly, Daniel Clamp tours the office, sees Billy’s illustration for the Clamp Chinese Centre, and makes a couple of changes. Witnessing Clamp’s friendliness toward Billy, Marla Bloodstone suddenly believes her employee is her career ticket to a relationship with the reclusive real estate magnate. She demands that Billy accompany her to dinner. Billy tells Gizmo to remain hidden, then visits Kate in the tour guide office to explain that Gizmo is in his office and needs to be spirited out of the building at quitting time. Billy reiterates the rules they learned about mogwais back home in Kingston Falls: Keep Gizmo out of the sun (bright light is fatal to mogwais), do not let him get wet (water spawns fur balls that turn into new mogwais), and do not let him eat after midnight (which spawns dangerous gremlins). Meanwhile, Gizmo leaves the file cabinet and accidentally gets wet when a janitor repairs a drinking fountain. Balls of fur leap from Gizmo’s back and turn into destructive mogwais. Laughing and giggling, these creatures toss Gizmo into an air duct. When Kate arrives, she sees a daffy mogwai, thinks he is Gizmo, and takes him to the apartment she shares with Billy. Meanwhile, at dinner, Marla cozies up to Billy, but he leaves as soon as possible. Rejoining Kate at home, Billy realizes the out-of-control mogwai is not Gizmo, stuffs it into a bag, and prepares to return to the office. However, his Kingston Falls neighbors, Murray and Sheila Futterman, show up with suitcases and announce their arrival in New York City to attend a reunion. Billy tells them they cannot stay because the apartment is being fumigated. As soon as the Futtermans leave, Billy and Kate return to Clamp Centre, arrive just after midnight, and discover that mogwais have taken over a yogurt shop on the first floor. By eating after midnight, they metamorphose into gremlins. Security personnel telephone police when cameras show Billy trying to break into his locked office, and he is taken to jail. Kate bails him out in the morning. At Clamp Centre, Gizmo wanders the air ducts until he drops through an opening into the basement, where he sees cocoons producing new gremlins. One of them captures Gizmo and dreams up various ways of torturing him. Meanwhile, Michael arms himself with a powerful flashlight and goes to the Security office, where Forster’s employees laugh at his warnings about gremlins until, suddenly, a gremlin attacks. Billy chases it away with his flashlight. Thanks to a gremlin tinkering with the elevator system, Kate is trapped in an elevator car and then sent crashing to the basement, but since so many gremlins are hanging onto the car’s underside, they cushion the landing. Another gremlin attacks Clamp in his penthouse, but the owner manages to stuff it into a paper shredder. Billy and Forster arrive to warn him to shut down the building before sunset, or else the gremlins will destroy the city. Elsewhere in the building, gremlins capture the cable network and genetics lab. One of them drinks an experimental brain hormone and becomes a genius. Another drinks a spider fluid and turns into a gremlin black widow. Another ingests a bat formula and grows wings. The brainy gremlin injects the bat gremlin with a “sunblock” formula, to allow it to fly out of the building without being killed by sunlight. Yet another gremlin drinks a special sex hormone that turns it into a “she” that looks like a street-corner floozie. When yet another gremlin drinks an electrified formula and transforms into a lightning bolt of pure energy, it enters the building’s electrical system. Kate pulls a fire alarm to alert everyone to leave Clamp Centre. The bat gremlin attacks the Futtermans on the street outside the building, and Murray, who recognizes what it is from his own experience fighting gremlins in Kingston Falls, knocks the bat into freshly poured concrete. The bat flies to the top of a cathedral, but is frozen into a gargoyle as the concrete hardens. Seeing that the cable network studio is abandoned, Uncle Fred takes over a television channel and reports on what is happening inside the locked-down building. Elsewhere, the floozie gremlin, wearing a green wig and red lipstick, takes a liking to Forster. Meanwhile, Gizmo escapes his captor and, inspired by one of Sylvester Stallone’s Rambo movies he saw in Mr. Wing’s shop, angrily wraps a bandana around his head, lifts weights, and makes a bow and arrow out of a large paper clip, a rubber band, and a pencil. When Billy goes upstairs to talk with Clamp, he sees the electrified gremlin emerge from a electrical outlet and guides it into the videoscreen telephone system, where he puts it on “hold” and traps it. Billy explains that they must get all the gremlins onto the first floor, with its huge glass windows, by fooling them into thinking the sun has already set. Clamp sets all the building’s clocks ahead, then takes a secret exit out to the street to prepare to have a large curtain dropped over the ground floor windows. When Murray Futterman sees Clamp emerge from the secret exit, he uses it to sneak into the building to help Billy. Meanwhile, Marla and Kate are trapped by the spider gremlin, but Gizmo emerges from an air duct in time to burn it to death with a flaming pencil arrow. After Murray saves Billy from a gremlin, the two hurry downstairs and watch the gremlins gather for a party on the first floor. The brainy gremlin leads the mob in a “New York, New York” musical production number. Outside, as Clamp prepares to drop the curtain and kill the gremlins with sunlight, storm clouds block the sun. Billy realizes that rain will only increase the gremlin population. Devising a quick plan, he tells Murray to get the fire hose and spray the partying gremlins. As the water swamps the ground floor, Kate transfers the telephone call containing the electrical gremlin to the telephone in Billy’s hand. As the lightning-bolt-like gremlin shoots out of the telephone and hits the other gremlins, a mass electrocution melts them all into miasma. By the time Clamp leads a police SWAT team inside in the Centre, the gremlins are dead. He makes Grandpa Fred the new Clamp Cable Network news anchor, appoints Marla his new publicity director, and declares that he is happy to see Clamp Centre destroyed, because it was not a people-friendly place. Seeing Billy’s sketch of little Kingston Falls, Clamp decides to build a “sensational small town” development, with Billy as his right-hand man. Billy and Kate walk home, hand in hand, with Gizmo, planning their wedding. Meanwhile, Forster is trapped on an upper floor with the love-besotted floozie gremlin, which now wears a wedding gown.