Professor Challenger leads team of scientists and adventurers to a remote plateau deep within the Amazonian jungle to investigate reports that dinosaurs still live there.

When his plane lands in London, crusty old professor George Edward Challenger is besieged by reporters questioning him about his latest expedition to the headwaters of the Amazon River. After the irascible Challenger strikes reporter Ed Malone on the head with his umbrella, Jennifer Holmes, the daughter of Ed's employer, Stuart Holmes, offers the injured reporter a ride into town. That evening, Jenny is escorted by Lord John Roxton, an adventurer and big game hunter, to Challenger's lecture at the Zoological Institute, and Ed invites them to sit with him. When Challenger claims to have seen live dinosaurs, his colleague Professor Summerlee scoffs and asks for evidence. Explaining that his photographs of the creatures were lost when his boat overturned, Challenger invites Summerlee to accompany him on a new expedition to the "lost world," and asks for volunteers. When Roxton raises his hand, Jenny insists on going with him, but she is rejected by Challenger because she is a woman. Ed is given a spot after Holmes offers to fund the expedition if the reporter is included. The four then fly to the Amazon, where they are met by Costa, their guide and Manuel Gomez, their helicopter pilot. Arriving unexpectedly, Jenny and her younger brother David insist on joining them. Unable to arrange transportation back to the United States, Challenger reluctantly agrees to take them along. The next day, they take off for the lost world and land on an isolated plateau inhabited by dinosaurs. That evening, a dinosaur stomps out of the jungle, sending them scurrying for cover. After the beast destroys the helicopter and radio, the group ventures inland. When one of the creatures bellows threateningly, they flee, and in their haste, Challenger and Ed slip and tumble down a hillside, where they encounter a native girl. The girl runs into the jungle, but Ed follows and captures her. They then all take refuge in a cave, where Roxton, who has been making disparaging remarks about Jenny's desire to marry him solely for his title, angers Ed. Ed lunges at Roxton, pushing him to the ground, where he finds a diary written by Burton White, an adventurer who hired Roxton three years earlier to lead him to the lost diamonds of Eldorado. Roxton then admits that he never met White and his party because he was delayed by a dalliance with a woman, thus abandoning them to certain death. Gomez angrily snaps that his good friend Santiago perished in the expedition. That night, Costa tries to molest the native girl, and David comes to her rescue and begins to communicate with her through sign language. After Gomez goes to investigate some movement he spotted in the vegetation, he calls for help, and when Roxton runs out of the cave, a gunshot from an unseen assailant is fired, nearly wounding Roxton and sending the girl scurrying into the jungle. Soon after, Ed and Jenny stray from camp and are pursued by a dinosaur, and after taking refuge on some cliffs, watch in horror as their stalker becomes locked in combat with another prehistoric creature and tumbles over the cliffs into the waters below. Upon returning to camp, they discover it deserted, their belongings in disarray. As David stumbles out from some rocks to report they were attacked by a tribe of natives, the cannibals return and imprison them in a cave with the others. As the drums beat relentlessly, signaling their deaths, the native girl reappears and motions for them to follow her through a secret passageway that leads to the cave in which Burton White lives, completely sightless. After confirming that all in his expedition perished, White tells them of a volcanic passageway that will lead them off the plateau, but warns that they must first pass through the cave of fire. Cautioning them that the natives plan to sacrifice them, White declares that their only chance of survival is to slip through the cave and then seal it with a boulder. After giving them directions to the cave, White asks them to take the girl along. As the earth, on the verge of a volcanic eruption, quakes, they set off through the Graveyard of the Damned, a vast cavern littered with dinosaur skeletons, the victims of the deadly sulfurous gases below. Pursued by the ferocious natives, Roxton takes the lead as they inch their way across a narrow ledge above the molten lava. After escaping the natives, they jam the cave shut with a boulder and, passing a dam of molten lava, finally reach the escape passage. At its mouth is a pile of giant diamonds and a dinosaur egg. As Costa heaps the diamonds into his hat, Challenger fondles the egg and Gomez pulls a gun and announces that Roxton must die in exchange for the death of Santiago, Gomez' brother. Acting quickly, Ed hurls the diamonds at Gomez, throwing him off balance and discharging his gun. The gunshot awakens a creature slumbering in the roiling waters below. After the beast snatches Costa and eats him alive, Ed tries to dislodge the dam, sending a few scorching rocks tumbling down onto the monster. Feeling responsible for the peril of the group, Gomez sacrifices his life by using his body as a lever to dislodge the dam, covering the creature with oozing lava. As the cave begins to crumble from the impending eruption, the group hurries to safety. Just then, the volcano explodes, destroying the lost world. After Roxton hands Ed a handful of diamonds he has saved as a wedding gift for him and Jenny, Challenger proudly displays his egg, which then hatches, revealing a baby dinosaur.