In UC 0093, Char Aznable has returned to prominence at the head of Neo Zeon and is leading the rebuilt Neo Zeon army in battle against the Earth Federation. He believes that the only way humanity will ever become truly free is if they throw off the chains of gravity and abandon their mother planet to become a New Type of mankind. As the film opens, Char’s forces are attempting to drop the asteroid Fifth Luna on Earth to trigger a nuclear winter. A special task force called Londo Bell, which includes One Year War veterans Amuro Ray and Bright Noa, engages Neo Zeon in a battle to prevent the catastrophe. Char and Amuro have been bitter rivals since the One Year War in 0079, where they fought on opposing sides and often clashed with each other. Amuro is piloting the RGZ-91 Refined Gundam Zeta (Re-GZ), which is a mass-production variant of the MSZ-006 Zeta Gundam. Char engages him with the MSN-04 Sazabi, which is equipped with a psycho-frame that amplifies Newtype psionic abilities, making it vastly superior to the Re-GZ. Despite Amuro’s superior Newtype abilities and piloting skills, the Re-GZ proves to be no match for the Sazabi, and Amuro is forced to withdraw as the asteroid successfully enters Earth’s orbit on a collision course with Lhasa, Tibet.

On Earth, Federation Vice Minister Adenauer Paraya and his rebellious teenage daughter Quess are trying to evacuate on the next available shuttle. Bright Noa’s wife, Mirai, and their two children are scheduled to board the next evacuation shuttle, but the Prime Minister uses his government position to claim their seats for himself and his daughter. Needing only two of the three seats and realizing that he’s potentially condemning the family to death, he allows Mirai to select one of her children to take the third seat. Mirai chooses her son, Hathaway Noa. The shuttle narrowly escapes the crashing asteroid, then rendezvous with the Londo Bell’s command ship, the Ra Cailum, commanded by Bright Noa, Hathaway’s father. The Ra Cailum is traveling to the Anaheim Electronics factory on the moon to collect Amuro’s new mobile suit, the RX-93 ν Gundam (pronounced ‘nu gundam’), a custom suit developed specifically for him which features a psycho-frame system similar to the one used by Char on the Sazabi. Amuro’s close friend, engineer Chien Agi, has been overseeing the project. She delivers the ν Gundam, but warns Amuro that she doesn’t know how Anaheim Electronics acquired the psycho-frame technology or what effect it will have on Amuro. She accompanies the ν Gundam aboard the Ra Cailum so she can fine-tune its performance if necessary. Bright is reunited with his son Hathaway, who has developed a crush on the Vice Minister’s daughter, Quess. Adenauer instructs Bright to deliver him to the Londo Bell’s headquarters at Londenion for an important meeting. While on board, Quess becomes smitten with Amuro, who senses her Newtype potential, but ignores the spoiled child.

On the Londenion colony, the Vice Minister’s mission is revealed to be a secret meeting with Char and other Neo Zeon leaders to sign a formal peace treaty. In exchange for disarming their fleet, the Neo Zeon will be given control of the former mining asteroid, Axis. While relaxing in the colony with Quess and Hathaway, Amuro recognizes Char and attacks him. As they struggle, Amuro gains the upper hand and draws a gun on Char. Quess feeling a strong connection to the charismatic Char, knocks the gun out of Amuro’s hand and use it to stop the fight. The two are then rescued by an artificial Newtype named Gyunei Guss, piloting an unarmed Zaku. Quess leaves with Char, much to Hathaway’s distress. Sensing her potential, Char begins manipulating Quess to gain her trust. Neo Zeon scientists quickly confirm his suspicions: Quess is a powerful, latent Newtype and a naturally gifted mobile suit pilot. Char then reveals that the treaty with the Federation is merely a ruse to gain control of the massive asteroid and the codes to its nuclear propulsion thrusters and to get the Federation to lower its guard. He knows that the Earth is already at the tipping point, and if an asteroid the size of Axis hits the planet, all life on the surface will finally be extinguished. To ensure that the Earth is rendered useless, he places a stockpile of nuclear missiles on one of his cruisers and anchors it at the front of Axis. He then orders Axis’ engines to power up and sets its trajectory for a collision with Earth. As soon as the asteroid starts to move, the Neo Zeon forces ambush the Federation fleet at the supposed disarmament ceremony. Quess Paraya takes part in the ambush, piloting an MSN-03 Jagd Doga, a mass-production model designed for Newtypes. She opens fire on a Federation cruiser, not knowing that her father is aboard. Quess feels him die with her empathic Newtype abilities but does not understand what she’s feeling or why. The overwhelming surge of emotion makes her fragile mental state even more unstable until she is forcibly removed from the battle by Gyunei Guss. She breaks away from him, however, and flies off to look for Char.

With the Federation fleet destroyed and the Londo Bell fleet left without reinforcements close enough to help, Bright Noa orders his fleet to depart, but tells his son Hathaway to remain aboard the station where he will be safe. Hathaway disobeys his father, renting an unarmed mobile suit designed for salvaging equipment in space, and uses it to stow away aboard the Ra Cailum. Char’s forces outmatch the Londo Bell fleet, but they bravely re-engage the Neo Zeon fleet in a desperate attempt to stop, divert, or destroy Axis. Bright Noa orders his mobile suits to engage the enemy and keep them from interfering as he bombards Axis with waves of missiles, attempting to hide nuclear missiles amongst the conventional warheads. The tactic fails, however, as the Neo Zeon pilots led by Gyunei destroy the oncoming waves of missiles. With his supply of nuclear weapons expended and no other options remaining, Bright Noa orders his remaining mobile suits to enter Axis in an attempt to detonate the asteroid’s nuclear reactors and destroy it from within.

Quess locates Char, who is piloting the Sazabi, and ejects from her Jagd Doga without a spacesuit, forcing Char to open his cockpit and pull her inside. She demands to know what his feelings for her are, and Char takes advantage of her unstable emotional state to manipulate her into piloting the prototype NZ-333 α-Azieru mobile armor. A furious battle between Londo Bell and Neo Zeon erupts. Quess descends into violence and madness as she pilots the α-Azieru and destroys several Londo Bell mobile suits. Hathaway steals a RGM-89 Jegan mobile suit and finds her in the middle of the battle. He tries to convince Quess to stop fighting and come back with him, but Quess is too far gone. She turns her weapons on Hathaway, but before she can fire, Chan Agi, piloting a damaged Re-GZ, kills Quess to protect Hathaway from the girl’s insane attack. Horrified and enraged at seeing Quess die right before his eyes, Hathaway opens fire on the Re-GZ, killing Chan.

Amuro and Char duel each other in their psycho-frame mobile suits, and Char reveals that he was the one who gave the psycho-frame technology to Anaheim Electronics so it could be added to the ν Gundam. When Amuro demands to know why, Char tells him that he wants them to have a fair fight to settle their grievances once and for all. Amuro and the Ra Cailum penetrate the Neo Zeon defenses and reach Axis, where Amuro notices the anchored Neo Zeon cruiser containing nuclear missiles. Realizing Char’s intentions, he opens fire on the cruiser, destroying both it and its nuclear cargo. The front of Axis is wreathed in nuclear fire, but it isn’t enough to stop the asteroid. Desperate now, Amuro lands on the surface of Axis and enters the asteroid on foot, looking for the nuclear reactors to sabotage. Char sees the abandoned ν Gundam and leaves the Sazabi to follow Amuro into Axis. The Ra Cailum dispatches unarmed salvage mobile suits to enter the asteroid as well, and the combat engineers successfully plant explosives on the reactor. Char and Amuro try to kill each other until Amuro receives word that the charges have been set and that all personnel need to evacuate Axis. Amuro returns to the ν Gundam, and Char returns to the Sazabi, and they re-engage each other in battle. The charges detonate, and the resulting nuclear explosion tears Axis into two parts. Char realizes that the Londo Bell forces were only partially successful: the back half of Axis will miss Earth, but the front half will still impact the surface, and that will be more than enough to eradicate all life on Earth.

Knowing that Londo Bell has come up short and that he has finally won, Char returns his attention to settling the score with his old rival. They air all of their grudges as they fight, focusing in particular upon the tragic death of their beloved Newtype, Lalah Sune, who was killed by Amuro during the One Year War when she sacrificed herself to stop him from killing Char. Amuro, sick of Char’s delusional rationalizations and self-serving narrative, defeats his long-time rival in their final duel, overpowering the Sazabi and forcing Char to be ejected from the wreckage. Amuro disables the escape pod’s thrusters, then grabs the pod and smashes it into the front of Axis, lodging it into the rock. If the Asteroid is going to hit Earth, then Char will have a front-row seat. Amuro, unwilling to give up, vainly attempts to push Axis out of Earth’s orbit using the power of the ν Gundam. His feelings of desperation and his refusal to give up hope, amplified by the psycho-frame technology, reach the hearts of all of the remaining pilots, who respond by joining him in the attempt to divert Axis. Newly arrived Federation reinforcements join Londo Bell and Neo Zeon pilots, but their efforts are in vain as one-by-one the inferior mobile suits are burned up in the atmosphere until only the ν Gundam remains. However, the collective will of all of humanity is focused and amplified through the ν Gundam’s psycho-frame, and that energy is enough to pull both halves of Axis away from Earth. As Amuro and Char argue over the latter’s use of Quess as a machine for his own ends, Char declares to Amuro that Lalah Sune was a “woman who could have been a mother to him” as the overflowing psycho-energy engulfs both rivals and the v Gundam before vanishing into space. In the aftermath, Hathaway and the people of Earth watch the resulting aurora.