At a Toronto, Canada, movie theater, brothers Doug and Bob McKenzie host a screening of their film to a disappointed audience. When one patron demands a refund, Bob hands him the fifteen dollars their father gave them to replenish the family beer supply. The next day, the brothers present a storekeeper with an Elsinore Beer bottle containing a live mouse, believing it will entitle them to free beer. The storekeeper directs them to the Elsinore brewery, which is adjacent to the Royal Institute for the Mentally Insane. They gain entrance by assisting Pam Elsinore, whose car is caught in the automatic gate. Her uncle, Claude Elsinore, and Brewmeister B. M. Smith observe via closed-circuit television and assume the two strangers are Pam’s attorneys. In the lobby, Doug and Bob bribe the receptionist with donuts, and learn that, following the recent death of founder John Elsinore, his widow, Gertrude, married her brother-in-law, Claude Elsinore, who is now acting president, although John left the brewery to his daughter, Pam. Meanwhile, in Claude’s office, Pam refuses her uncle’s offer of $5 million to allow him to retain the presidency. Doug and Bob are directed to the office by employee Jean “Rosy” La Rose, a former hockey player who suffered a nervous breakdown. When they present Claude with the bottled mouse, Henry, the company manager, argues that errors of this sort never occurred before the brewery became fully automated. With Pam’s approval, Henry hires Doug and Bob to check bottles for mice. At the neighboring mental hospital, Smith and his assistant, Ted, perform mind control experiments on patients, using an electronic synthesizer and beer laced with psychoactive drugs. Doug and Bob spend the night in the lobby, concerned that they may be late for work the next day. In the morning, they present Pam with several dozen donuts, and she helps the brother carry them to the cafeteria. Doug turns on the lights, inadvertently activating a video game machine, which displays the number “040483,” the date of John Elsinore’s death. Later, Pam criticizes Smith’s need for surveillance cameras throughout the brewery and gives him two weeks’ notice of termination. Smith confers with Claude to plan Pam’s murder, and though Claude Elsinore is reluctant, the brewmeister reminds him that he was complicit in the murder of his own brother. Ted conducts an experiment in which Doug, Bob, and Rosy participate in a hockey game with a group of drugged mental patients. Afterward, the brothers return to the locker room and discover their clothes have been stolen. In the cafeteria, as Pam and Henry examine the game machine, it displays a video recording of her father’s murder. Claude and Smith, disguised as Doug and Bob, shoot them with tranquilizer darts and seal them in beer kegs. The brothers stumble into the control room, and while Bob amuses himself with Ted’s synthesizer, Doug steals a computer disc, unaware that it contains the murder video. Claude and Smith sneak into the room and shoot Doug and Bob with tranquilizer darts, then seat them in their van while kegs containing Pam and Henry are loaded into the back. As Ted cuts the brake line, Claude Elsinore awakens the brothers and directs them to a wharf on Lake Ontario, where a birthday party for Pam is supposedly to be held. Rosy overhears the instructions and plans to meet them there. Along the way, Doug and Bob stop at their home and leave the computer disc as a toy for their dog, Hosehead. Upon resuming their trip, the brakes fail and police pursue the van as it speeds through the streets. Unable to stop, Doug drives the van into the lake, leaving the keg containing Henry on the wharf. Rosy witnesses the accident and dives in to save Pam, but he sinks to the bottom as she swims to the surface. When neither of the brothers emerge from the lake, police send divers to recover their bodies, but instead find Doug, Bob, and Rosy inside the van drinking beer. Brewmeister Smith arrives at the scene and drugs Pam with a second dart, preventing her from speaking with police. While Rosy and Henry recover in the hospital, the brothers are arrested for kidnapping Pam, who is in a drug-induced stupor. Meanwhile, Smith is unable to find the computer disc, and assumes the McKenzie brothers were aware of its contents when they stole it. Doug and Bob attend a court hearing, accompanied by their attorney, Jack Hawkland, who intends to have them acquitted on grounds of mental incompetence. Claude Elsinore testifies for the prosecution, presenting a contrived videotape as evidence against Doug and Bob. Smith testifies as head of psychiatry for the mental institute, and persuades the court to commit the brothers to his care. Later, Claude Elsinore enters Rosy’s hospital room disguised as a doctor, but is quickly exposed as a fraud. He escapes in a stolen car, with Rosy in pursuit. Police search the McKenzie home and find the incriminating computer disc on the doorstep, while Ted administers a polygraph test to Doug, hoping to learn its location. Rosy breaks into the institute and subdues Ted, then rouses Pam from her stupor. Later, Smith abducts Pam and Bob at gunpoint and locks them inside a beer vat, while revealing his plans for world domination by addicting all of humanity to Elsinore beer, beginning with that day’s Oktoberfest celebration in Toronto. He fills the vat with beer, expecting Bob and Pam to drown. Meanwhile, Henry leaves the hospital in a stolen police car, leading numerous officers to the brewery. Doug leads a group of mental patients in an attack on Claude Elsinore, while Rosy battles Smith in his control room, resulting in the brewmeister’s electrocution and a fire in the mental institute. Rosy discovers the vat containing Bob and Pam, but finds them both unharmed, as Bob drank the vat dry. He frees himself by dislodging one side of the vat with an enormous belch, then douses the fire at the institute with his urine. When Pam warns police of the tainted beer sent to Oktoberfest, Doug paints a skunk stripe on Hosehead and releasing the animal at the fairgrounds to frighten away the celebrants. The plan succeeds and the police inspector thanks the brothers for their help, assuring them that all criminal charges have been dropped, though their mental competency is still in question.