In 1957, Colonel-Doctor Irina Spalko (Cate Blanchett) and a convoy of Soviet soldiers infiltrate a military base in the Nevada desert. They force Indiana Jones (Harrison Ford) to lead them to a crate in "Hangar 51", which holds the remains of an extraterrestrial creature that crashed ten years before in Roswell, New Mexico. Jones attempts to escape, but is foiled by his partner Mac (Ray Winstone), who reveals that he is working with the Soviets. After a fight and an elaborate vehicle chase through the warehouse, Jones escapes on a rocket sled into the desert, where he stumbles upon a nuclear test town and survives a nuclear blast by hiding in a lead-lined refrigerator. While being debriefed, Jones discovers he is under FBI investigation because of Mac's Soviet ties. Jones returns to Marshall College, where he is offered a leave of absence to avoid being fired because of the investigation. While leaving, Jones is stopped by Mutt Williams (Shia LaBeouf) and told that his old colleague, Harold Oxley (John Hurt), disappeared after discovering a crystal skull in Peru.
In Peru, Jones and Mutt discover that Oxley was locked in a church-operated psychiatric hospital until Soviet soldiers kidnapped him. In Oxley's former cell, Jones discovers clues to the grave of Francisco de Orellana, a Conquistador who went missing in the 1500s while seeking Akator (also known as El Dorado). At the Nazca Lines, Jones finds the crystal skull that Oxley hid in Orellana's grave. The skull is elongated in the shape that indigenous peoples formed their own skulls into; the Soviets believe the skull is from an extraterrestrial life-form, holding great psychic power. The Soviets capture Indy and Mutt and take them to the camp where they are holding Oxley and Mutt's mother, Marion Ravenwood (Karen Allen), who reveals that Mutt is Jones's son. The four escape from the camp, leading to a lengthy vehicle chase involving sword fights and several Soviet soldiers being killed by army ants. Mutt, Marion, Mac, Oxley, and Jones ride an amphibious vehicle over a cliff and down three waterfalls, eventually finding the Temple of Akator. Claiming that he is a double agent working against the Soviets, Mac enters the temple with Jones and the group while leaving a trail for the Soviets to follow.
The group enters the temple and Jones uses the skull to open the door to a chamber tomb. Inside, thirteen crystal skeletons, one with a missing skull, are seated on thrones. When the Soviets arrive, Mac reveals that he lied about being a double agent. Spalko places the skull onto the skeleton, and it begins communicating to the group through Oxley using an ancient Mayan dialect. Jones translates this to mean that the aliens want to give them a great gift. Spalko demands to know everything, and the skulls begin firing knowledge into her eyes, causing her to shake. As a portal to another dimension appears over the room, Oxley regains his sanity and explains that the aliens are inter-dimensional beings who taught the Maya their advanced technology. Jones, Mutt, Marion, and Oxley escape from the temple, but Mac is sucked into the portal. The skeletons form into a single alien which continues to feed Spalko with knowledge; however, the knowledge overwhelms Spalko, causing her to ignite and disintegrate. The temple crumbles, and a flying saucer rises from the debris and disappears. Back home, Jones is made an associate dean and marries Marion.
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