In the year of 1957, a robotic giant crash-lands off the cost of Maine. With no knowledge or memory, the Giant journeys towards an electrical substation near the small town of Rockwell to eat the metal contents. This alerts a mischievous yet intelligent and lonely boy named Hogarth Hughes, who explores the area armed with a BB gun. He finds and frees the Giant from some wiring before people can discover him. Along the way, the Giant gets demolished by a train when he tried to eat some tracks, but generates a signal that causes his parts to automatically reassemble into one, however his hand is loose in Hogarth's house. At this time, a government agent named Kent Mansley investigates the substation and traces the broken and abandoned BB gun to Hogarth's household, where his widowed mother, Annie, allows him to stay with them. Hogarth narrowly manages to keep the Giant's hand out of his sight. Once hidden, Hogarth shares with the Giant several comic books, one of which stars Superman, another stars an evil giant robot named Atomo. The latter concept of someone like him being villainous concerns the Giant, but Hogarth assures him that he can be what he chooses to be.
The next day, Hogarth hides the Giant in the works of a beatnik scrap artist named Dean McCoppin. Hogarth and the Giant continue to play, bond, and learn things about one another, even revealing the Giant can fly. At one point, the Giant begins to bond with a deer, but hunters shoot the deer, causing the Giants first experience with death and guns. Throughout this, Mansley continues to try to extract information about the Giant from Hogarth, even threatening to take him from his mom and make his entire life miserable. Eventually, Mansley discovers a photo of Hogarth and the Giant, giving him enough proof to summon the military. The Giant avoids capture by disguising himself as a piece of scrap art. With the army gone, the Giant pretends to be Superman while Hogarth pretends to be a super-villain. He pulls a sparkler gun, which sets of a defense mechanism, causing the Giant to fire a laser beam. Dean narrowly saves Hogarth and angrily sends the Giant away, calling him "a big gun that walks".
Soon after, Hogarth realizes that the Giant has an uncontrollable reaction to guns, and tries to return to the Giant. Meanwhile, the Giant saves the lives of two boys, but Mansley claims that the Giant attacked them. The military barrages the Giant with all their firepower, failing to harm him but knocking out Hogarth in the blast radius. The Giant, thinking they killed Hogarth, flies into a rage and activates his defense mechanism, unleashing his full power against them, which effortlessly forced them to retreat. Mansley convinces General Rogard that the only way to stop the Giant is to lead him into the ocean and destroy him with a missile. However, Hogarth comes to and reminds the Giant that guns kill and that he must choose what he wants to be.
Hogarth words reach the Giant, and he deactivates his weaponry. Rogard realizes Mansley lied and orders his forces to stand down. Despite this, a paranoid Mansley takes Rogards walkie-talkie and orders the missile strike, failing to realize that the Giant is still in the town and leaving the populace not enough time to evacuate to safety. Mansley makes a cowardly attempt to flee the very town he doomed, but Rogard orders his arrest. The Giant knows that he must sacrifice himself, and bids Hogarth farewell before flying up to intercept the bomb with his body. In his last moments, the Giant remembers Hogarth's words and envisions himself as Superman. The townsfolk celebrate their safety, while others, especially Hogarth, mourn the Giant's sacrifice.
Time has passed, and Dean has built a statue of the Giant and started a relationship with Annie. Hogarth receives a package from Rogard containing the only recovered piece of the Giant, a small jaw bolt. That night, Hogarth notices the bolt beeping and trying to roll out the window. Recognizing it as the Giants repair signal, he sets it free, where it and the rest of the Giants parts converge on the Langjökull Glacier in Iceland. The film ends with the Giant's head waking up and smiling.