In the ancient kingdom of Mahishmathi, a woman carrying a baby falls into a waterfall and breathes her last, but before dying, she holds the baby in one hand above her head. The baby is rescued by local villagers and adopted by Sanga (Rohini) and her husband. Named Shivudu, (Prabhas) he grows up to be a strong, adventurous young man who is curious about the waterfall and the land beyond. After finding a wooden mask on the ground, he is driven to find the owner of the mask and succeeds in climbing the waterfall. The mask belongs to Avanthika (Tamannaah), a rebellious warrior of a group led by Devasena’s brother engaged in guerrilla warfare against Emperor Bhallaladeva (Rana Daggubati) of Mahishmati to rescue their former queen Devasena (Anushka Shetty). Avantika is given the opportunity to rescue the queen. She falls in love with Shivudu after finding out that he climbed the waterfall for her. Shivudu pledges to help her in her mission and sneaks into Mahishmati to rescue Devasena.
Shivudu manages to flee with Devasena, but is chased down by Bhallaladeva’s son, Bhadrah (Adivi Sesh) and the loyal soldier Kattappa (Sathyaraj). After Shivudu beheads Bhadrah, Kattappa drops his weapon, realizing that Shivudu is Mahendra Baahubali, the son of late king Amarendra Baahubali. He narrates the story of Amarendra’s past. Amarendra’s father had died long ago, while his mother died giving birth to him. His uncle Bhijjaladeva (Nassar) was deemed unfit to rule due to his crooked nature, however, he believes he was denied the throne due to the fact that one of his arms is disabled. Bijjaladeva’s wife Sivagami assumed control of the kingdom with Kattappa’s assistance until a new king could be selected. Amarendra was brought up together with Bijjaladeva and Sivagami’s son Bhallaladeva. Both young men were trained in arts, science, disguise, politics, and warfare, but they had different approaches towards kingship. While Amarendra was gracious and loved his countrymen, Bhallaladeva was violent and achieved his goals by any means possible.