The film is set in Britain and Ireland, In the Dark Ages, After the fall of the Roman Empire in the 5th century.

Lord Marke of Cornwall (Rufus Sewell) Plans to unify the peoples of Britain -- Celts, Angles, Saxons and Jutes - Under himself as high king to resist Irish domination. The Irish king Donnchadh (David O'Hara) Discovers this and sends troops to attack a Jutish castle where a treaty between the British tribes is being discussed. The raid claims the lives of the castle's lord and his wife, and Marke saves their son Tristan at the cost of losing a hand. Feeling compassion for the young boy whose father loyally supported him, Marke welcomes Tristan into his home. Tristan grows to be a fierce, courageous warrior (James Franco) Whose loyalty to Marke is not that of a knight to his lord, but rather a son to his father.

Tristan and other Cornish warriors launch an attack on an Irish slave caravan: in the battle, he finds himself fighting Morholt, Donnchadh's champion, leader of his army and to whom Princess Isolde (Sophia Myles) Has been promised in marriage. Though he kills Morholt and Donnchadh's forces are overrun, Tristan is severely wounded in the fight and believed dead, though he is in fact only suffering the effects of Morholt's poisoned sword.

Tristan's body is put out to sea on a funeral boat which eventually washes up along the shores of Ireland. He is discovered by Isolde and her maid Bragnae, who administer an antidote that revives him and then secretly nurse him back to health. Tristan and Isolde fall in love; however, Isolde does not disclose her real name. After some time Tristan is forced to flee to Cornwall.

Plotting to defeat Britain, Donnchadh proposes a peace treaty, promising his daughter Isolde in marriage to the winner of a tournament. Tristan participates on behalf of his uncle King Marke, unaware that the "prize" Isolde is the woman he fell in love with in Ireland. He wins the tournament, only to discover the truth about Isolde and to see her betrothed to Marke.

Although Marke is kind to Isolde, her heart belongs to Tristan, who is torn between his love for Isolde and his loyalty to Marke, a man whom he has loved as a father and who saved his life as a child. The couple eventually begin an affair behind Marke's back, although they often consider ending it for the sake of their duty to Marke. This affair is discovered by Lord Wictred (Mark Strong), Who conspires with Donnchadh to use their love to overthrow Marke, Wictred getting Marke's throne in exchange.

In Tristan's final attempt to end the relationship, he and Isolde are caught in an awkward situation by all of the British kings. The kings decide to part ways with Marke; the alliances are ruined and his wife and son-figure have betrayed him. Marke is at first furious with the pair of them, but relents after hearing Isolde explain her history with Tristan and offers them the chance to run away together. But Tristan (who tells Isolde that if they elope, they will be remembered for all time as those "whose love brought down a kingdom") Chooses instead to stay in England and fight for his king. At the same time, Marke's nephew and Tristan's old friend Melot (Henry Cavill), Angry at his uncle's long favouring of Tristan and tricked by Wictred's seeming support of him, shows Wictred an old passage into the Roman foundations of Marke's castle that Tristan and Isolde used to carry out their affair. Wictred then fatally stabs Melot and sneaks his army into the castle. Marke and his forces swiftly become pinned down by Donnchadh's army outside the castle and Wictred's men within.

Tristan sneaks back into the castle via the secret tunnel. On the way, he finds the dying Melot: the old friends forgive one another before he dies. Tristan emerges from the tunnel and attacks Wictred's men, allowing Marke's soldiers to secure the castle, but he is mortally wounded in combat by Wictred, though he kills Wictred shortly afterwards. Now outnumbered, Tristan, Marke and the soldiers loyal to him emerge from the castle and present Wictred's severed head to Donnchadh. Marke urges the British kings standing with the Irish to aid them in making Britain a single, free nation: inspired by his words, the British kings and their men attack Donnchadh and his army. As a fierce battle between the British and Irish erupts, Marke carries a dying Tristan to the river, where they are met by Isolde. Marke leaves to lead the British to victory, while Tristan eventually dies in Isolde's arms after uttering his last words of "You were right. I don't know if life is greater than death. But love was more than either."Isolde sees to his burial beneath the ashes of the Roman villa where they had met to be with each other, and plants two willows by the grave, which grow intertwined; she then disappears from history and is never seen again. Marke, it is said, defeated the Irish, united Britain, then ruled in peace until the end of his days.