The film starts with Arun Khanna (Sunny Deol), an army intelligence officer who is deputed at the Kashmir border under an assumed name of Major Ravi Khanna by the Indian Secret Service Agency - RAW. Major Khanna comes to a village called Kupwada in Kashmir and sets up his spy network, with the objective of getting information regarding terrorist activities across the border.

A beautiful girl Reshma (Preity Zinta) who is from the same village becomes a part of this network. She is actually a Hindu whose parents were killed in a terrorist attack on the village. She has been brought up by her Muslim neighbours Yusuf Khan and his wife like their own daughter.

Major Khanna trains her for spying and during this process of training, Reshma falls in love with Major Khanna. Major Khanna is also attracted to her because of her qualities and her innocence but because of his duty towards his country, he is forced to send Reshma across the border to Pakistan as a maidservant in Colonel Hidayatulla's (Deep Dhillon) house.

The ISI head Isaq Khan (Amrish Puri), Azhar Mehmood (Khalid Mohamad) and a group of nuclear scientists come to Colonel Hidayatulla. They plan to make a nuclear bomb and tell Colonel Hidayataulla to set up a laboratory. They intend to get the various parts of the bomb from their friends in various countries and so plan to visit those countries.

In reality the ISI head Isaq Khan and Maulana Azhar are enemies of Major Ravi Khanna because a year back Ravi Khanna had gone as under secretary Ajay Chakravarthy from RAW and had exposed a vicious plan of theirs.

In the meantime, Reshma is exposed in front of Isaq Khan, Maulana Azhar and Colonel Hidayatulla. She manages to escape from them and comes across the border with important information. Major Khanna expresses his love to Reshma and proposes to marry her.

While Major Khanna and Reshma are getting engaged on the ship, a speedboat loaded with RDX, sent by Colonel Hidayatulla and company, blows up the ship. In the accident, Reshma falls into and is swept along by the current, until she is found on the shores of Lahore, where she is rescued by a Muslim boy named Salmon.

Salmon and his family have a business and a house in Canada. Reshma's legs are badly affected and she is unable to walk. They decide to take her to Canada to get her treated.

Major Khanna finds out that Isaq Khan and Maulana Azhar were responsible this attack. He launches an attack on the Colonel and kills him after extracting information about his hideous plan to build a nuclear bomb. He also discovers that Isaq Khan and his group have gone to Canada to build the bomb. The Canadian Government agrees to help the Indian Government in capturing Isaq Khan and his friends and bringing them to justice.

In the meantime, Reshma too is in Canada, and her legs are being treated by Shayna (Priyanka Chopra), who is the daughter of a fundamentalist by the name of Zakaria (Kabir Bedi). Zakaria has put up a front of being an industrialist and a very clear-hearted businessman but behind this facade he is a partner of Isaq Khan and Maulana Azhar in making the nuclear bomb.

Ravi Khanna and Reshma think of each other as dead but late Reshma comes to know that Ravi Khanna is alive and is in Canada itself. Reshma is treated by Shayna and she becomes all right.

Ravi traps Shayna and pretends to be in love with her, as he wants to become a part of Zakaria's group. Since Shayna is Zakaria's daughter, Ravi finds this as an ideal way. He also tells them that he too wanted to make a nuclear bomb and get Kashmir its freedom. He even has to get married to Shayna to win their confidence. Reshma meets Ravi Khanna at the time of his marriage to Ruhi. She realizes that whatever he is doing is for a mission for his country. Major Khanna is very happy on seeing Reshma alive but knows that now they cannot become one. He sees her off at the airport and promises not to cheat Shayna of these criminals. Reshma goes back to India.

Major Khanna exposes Maulna Azhar, Zakaria and Isaq Khan's plan of getting the nuclear bomb. The Canadian government, the Indian government and the world comes to know that their plan has been destroyed by Arun Khanna… for which he is called 'The Hero', the world over. Shayna gives up her life to fulfill this mission. Finally Arun Khanna and Reshma meet.