Mohanlal plays Velayudhan who comes to the remote village Mullankolli as a young boy during a flood. He floats on a reef to the village. He was saved and was brought up by Valiya Nambiar (Madhu) a feudal landlord of the area.
Velayudhan grows up into a rough and tough man with a heart of gold. He always reacts against injustice and supports people who are wronged. The local money lender and panchayat member Kurup ( Jagathy) and Gopinathan Nambiar ( Siddique) son-in-law of Valiya Nambiar, hates him cause they cannot have their own way in the village because of him. They want to eliminate him somehow and brings Gundas from outside to oust him but they always fail.
When he sees injustice Velayudhan uses a stick to stamp his authority and to warn the hooligans. He sets the rules for the villagers to follow. He is not afraid of anyone and the only people he listens to is the man who brought him up Valiya Nambiar and Kelappan (Innocent) who looked after him as a child and who he lives with. He has a complicated love life and the three women in his life include Kelppan's daughter Leela (Bhavana) who has an eye for him while he treats him like his sister, Janaki his childhood friend cum sweetheart whom he lost (Devyani) and a prostitute Shanta (Sona Nair). Find out what happens to his life with Gopinathan always scheming things to get him out of the way..