On Halloween, Gotham City Mayor Don Mitchell Jr. was assassinated by a serial killer who calls himself Rudler. Billionaire Bruce Wayne, who has been a vigilante Batman for two years, is working with the Gotham City Police Department (GCPD) to investigate. Lieutenant James Gordon discovered that Rudler had left a message for Batman, but Commissioner Pete Savage condemned him for allowing a janitor to enter the scene and forcing Batman to leave. Rudler killed the savage and left another message for Batman.
Batman and Gordon discover that Rudler left his thumb in Mitchell's car. It shows Mitchell with Anika, a woman, in the Iceberg Lounge, a nightclub run by Mobster Carmen Falcon's Lieutenant Penguin. Batman asks Penguin, who pleads for ignorance, but notices that Selena Kyle, Anika's roommate and girlfriend, works as a waitress there. He follows Selena to question Anika, but she disappears. Batman sends Selena back to the Iceberg Lounge to find the answers. Through Selena, Batman learns that Savage was on Falcon's payroll, as does District Attorney Gil Coulson. Selena stops communicating when Batman pressures her on her relationship with Falcon.
Rudler kidnaps Coulson, puts a timed collar bomb around his neck, and sends him to disrupt Mitchell's funeral. When Batman arrives at the scene, Rudler calls him by Coulson's phone and threatens to detonate the bomb if Coulson can't answer the three riddles. Batman helps Coulson answer the first two, but Coulson refuses to answer the third - the name of the informant who provided the GCPD information that ended a historic drug crash that Mobster Sal Maroni underwent surgery - and died. Batman and Gordon speculate that the informant may be a penguin and trace him to a drug deal. He learned that Maroni's operation had never ended and that many GCPD officers were involved. Selena unknowingly exposes them when she arrives to steal money. As the penguin fled, Selena found Anika's body in the trunk of the car. Batman catches the penguin after chasing him in Bat Mobile but finds out that he was not an informant.
Batman and Gordon follow Rudler's path to the ruins of an orphanage run by Bruce's parents, Thomas and Martha. They learn that Rudler was a resident of the orphanage and resents the Van family. Bruce's butler and caregiver, Alfred Penny Worth, is hospitalized after opening a liter bomb in Bruce's name. Rudler then leaked evidence alleging that Thomas, who was running for mayor when he was assassinated, threatened to reveal embarrassing details about Martha's history of mental illness. But Falcon was hired to kill a journalist. Bruce, who grew up believing that his father was morally superior, confronted Alfred. Alfred confirmed that Thomas had asked Falcon to threaten the journalist, but decided to hand Falcon over to police after learning of the murder. He speculated that Falcon had killed Thomas and Martha to stop him.
Selena tells Batman that Falcon is her carefree father. He learned that Anika had been killed because Mitchell had told her that Falcon was an informant and that he intended to kill her. Batman and Gordon arrive at the Iceberg Lounge just in time to stop him and capture Falcon, but Rudler shoots him from a nearby building. Rudler is being held at Arkham State Hospital, identified as forensic accountant Edward Neston. Neston says he envies Bruce for the sympathy he received after his parents' murder when he was ignored, and he wants to partner with Batman and become a similar masked janitor. Was Batman angrily dismisses Neston. Searching his apartment, Batman discovers that Neston has planted car bombs around Gotham and planted an online plot to assassinate Mayor-elect Bella Real.
The bombs destroyed the breakwater around Gotham and flooded the city. A shelter has been set up in an inner field, where Neston's followers shoot Rial but he is stopped by Batman and Selena. As a result, Neston befriends another prisoner, [a] while Selena releases Gautam in addition to rescuing him. Batman helps with recovery efforts and promises to create hope in Gotham.