The Doctor (David Tennant) manages to stop certain death at the hands of the Cybermen by using the power cell from the TARDIS, and he and the rest of his party -- including Rose (Billie Piper), Mickey (Noel Clarke), Ricky, Pete Tyler (Shaun Dingwall) and Jake (Andrew Hayden-Smith) -- are rescued by the van driven by Mrs Moore (Helen Griffin). Pete confesses that he's the Preachers' spy inside the Cybus Corporation. They escape and split up, but Ricky is killed by pursuing Cybermen, electrocuted while struggling to get free.

John Lumic (Roger Lloyd-Pack) begins operating his master plan. Cybus Industries sends a control signal to everyone wearing the earpods, including most of London; the controlled populace begin a march toward Cybus facilities where they will be "upgraded" to Lumic's design. However, the Cybermen are one step ahead of him, realizing that he too is human and inferior to them; they set about "upgrading" him as well.

When Jake realizes Ricky is dead, he lashes out at Mickey, but the two are forced to team up again when they attack the main Cybus facility. Mickey and Jake spot a zeppelin hovering over the plant, while Rose and Pete masquerade as controlled Cyber-subjects, marching in the front door. The Doctor and Mrs Moore enter through the cooling tunnels below the station, but after meeting a Cyberman who they realize has been affected by a faulty inhibitor (one who remembers her origins), Mrs Moore is killed and the Doctor is captured. Rose and Pete, meanwhile, discover that Jackie (Camille Coduri) has already been turned into a Cyberman inside the plant.

The Doctor confronts the Cyber-Controller, the "upgraded" John Lumic, while on the zeppelin, Mickey and Jake attempt to take control of the ship and fight off a Cyberman at the same time. They are able to stop the control signal and the humans are released. The Doctor pleads with Lumic to stop what he's doing; Lumic, in his quest to create a utopian society, has bred all humanity out of his subjects. Mickey, meanwhile, discovers the code for the Cyber control systems, and the Doctor uses it to make all of the Cybermen go mad -- they realize what Lumic has done to them, and are no longer a threat. As Lumic's facility goes down in flames, Mickey and Jake take off in the zeppelin, but drag a ladder behind them so that the Doctor, Rose and Pete are able to escape. The Cyber-Controller pursues them, but falls from the ladder to his death.

The Doctor, Rose and Mickey return to the TARDIS, where Mickey confesses that he has decided to remain behind -- in this universe, he is no longer the useless sidekick but, in Ricky's shoes, has the chance to do good. Rose resists the idea but eventually the two say goodbye to their friend and the TARDIS departs, fully recharged but unable to return to this universe in the future. As the Doctor and Rose return to our universe, Mickey contemplates his future, telling Jake he's not his counterpart, but his own man, and the two set out to set Cybus Industries' terror to right.