One night, after a beach party, Chrissie Watkins (Susan Blacklinie) goes skinny-dipping in the ocean off of Amity Island, a peaceful beach community that relies on summer tourism and fishing for its economic survival. While another partygoer lies drunk on the beach, Chrissie is attacked and killed by a great white shark.
Martin Brody (Roy Scheider), the new Chief of Police for Amity Island wants to shut down the beaches and protect the people but is overruled when Mayor Vaughn (Murray Hamilton) and local coroner persuade him that Chrissie could have been struck and killed by a boat propeller. Mayor Vaughn and other civic leaders want to avoid a panic that would keep tourists from flocking to Amity. The next day, however, the shark attacks and kills Alex Kitner, a young boy, as other bathers splash nearby. The boy's mother places a bounty on the shark, encouraging amateur shark hunters from all over New England to descend on Amity and crowd the harbor with boats and unsafe fishing methods. Meanwhile, the town hires a marine biologist, Matt Hooper (Richard Dreyfus), to evaluate the seriousness of the threat at hand. When some local fishermen catch a tiger shark, the crisis is declared officially over despite Hooper's objections that the wounds on Chrissie's remains don't match the size of the killed shark's mouth. He later demonstrates that the tiger shark did not kill Alex Kitner either. That night, he and Brody find the derelict boat of a local fisherman. Hooper goes underwater to investigate further and discovers a great white tooth lodged in the boat's hull. Hooper loses the tooth when he is startled by the fisherman's severed head. Without the tooth, he and Brody are unable to persuade Mayor Vaughn that Amity still has a serious shark problem.
On July 4th, the shark attacks and kills a boater, an event that nearly claims the life of Brody's eldest son. Brody finally convinces Mayor Vaughn to hire an eccentric local fisherman, Quint (Robert Shaw), to hunt and kill the shark. Quint, Hooper, and Brody set out on Quint's ship, the Orca. Quint is at first disdainful of Hooper and the scientific equipment he brings on board but after the two men drunkenly compare fishing wounds, a bond develops between the men. The shark proves to be smarter than Quint and Hooper expected and soon has disabled the boat. Hooper goes down in a shark cage in an attempt to jab it with a poisoned explosive dart. However, the shark attacks Hooper's cage and he barely escapes with his life. The shark then leaps out of the water and onto the Orca's transom, driving it beneath the waves. Quint slides down the deck and into the waiting shark's mouth. Brody is able to lodge one of Hooper's airtanks into the shark's jaws and detonates it with a well-aimed rifle shot as the Orca sinks around him. As the shark's corpse sinks to the ocean floor, Brody and Hooper paddle back to shore.