In 1937, Indiana Jones returns to Marshall College after leaving his fiancée Marion Ravenwood. A giant man named Locus breaks into the College, steals a cat mummy, and knocks Jones unconscious before leaving. Jones notices Locus's medallion bears a symbol resembling that of the Vatican Secret Archive and infiltrates Vatican City for answers. The city is under the control of Italian dictator Benito Mussolini and the Blackshirts, who have been working with Nazi German archeologist and occultist Emmerich Voss.

Jones meets reporter Ginetta "Gina" Lombardi, who is investigating Voss for her sister Laura's disappearance; the two team up. They discover that a tribe of giants called the "Nephilim Order" have been covertly working for the Roman Catholic Church to protect the secret of the "Great Circle", and that the cat mummy contains a special stone related to it. Voss steals the Order's stones and flees as Jones and Gina stow away on his zeppelin. Jones then explains the Great Circle is a group of sacred religious sites across the world that form a perfect circle, and that he fears that Voss has discovered some secret to its power.

Arriving at a Nazi dig in Gizeh, Jones learns the Order has been working with Egyptians for thousands of years prior to the Catholic Church's foundation. The pair then finds the Idol of Ra to take its stone, but Voss recovers it and leaves Jones for dead in the desert. Gina rescues Jones and the pair travel to the Himalaya Mountains, where they learn the third stone has transported a Nazi battleship from South America to the Himalayas. After finding Laura frozen to death, Jones is captured by a Nazi colonel named Viktor Gantz. Gina sets off a grenade, which allows Jones to escape but sends the Nazi battleship skidding down the mountain.

Jones is able to use the third stone to open a portal, transporting them to Shanghai in the midst of the Japanese invasion of the city, where Gantz dies. After hijacking a Japanese fighter plane, the pair travel to the nearest Great Circle ruin in Sukhothai, Siam. Locus confronts them during their search, warning that the Great Circle's secret must never come to light, but Jones ignores his warnings. Voss attacks them as Jones collects the stone. As they escape, Gina is captured.