Raj Mathur (Shah Rukh Khan) is a young engineering graduate from Darjeeling who comes to Bombay with only one ambition - to become a big engineer. In Bombay, he arrives in a lower middle-class locality in search of a distant relative, only to discover he has left years before. He spends the night at a temple, where he meets a philosophical streetside performer Jai (Nana Patekar), who becomes a close friend and gives him a place to stay in the basti. With no connections and no experience, he finds it hard to get a job in the city until a beautiful girl from the basti, Renu, finds him a job as a trainee with the construction company where she works as a secretary to Chabbria (Navin Nischol).

At a board meeting Raj Mathur impresses Chabbria with a useful suggestion for cost efficiency in the company, to the discomfort of the corrupt senior executive Malhotra (Ajit Vachani). Also impressed with Raj Mathur is Chabbria's daughter Sapna (Amrita Singh) who begins to fall in love with him.

Raj Mathur's career starts to rise meteorically and Sapna introduces him to a new lifestyle, giving him the keys to a new car and a new house. As Raju's involvement with Sapna increases Renu begin to feel neglected and insecure and warns him about Sapna's intentions.

To frame Raj Mathur, Malhotra tampers with the cement in a bridge project, which is being overseen by Raju. When the bridge collapses and people, some of whom belong to Raju's former basti, die because of the adulterated cement, Raju is held responsible as the chief engineer. To save face, even Chabbria and Sapna, who know Raju is innocent, condemn him publicly.

A court case is filed against him and only a last minute volte face by Sapna, who testifies in his favour, saves Raj Mathur from conviction. A chastised Raju returns to claim his love Renu and the couple walk away into a new life together.