The film starts with Red (Jason Sudeikis) running through the forest frantically with an egg. Red runs into trees and several other animals before making it to the home of a bird family. He puts on a clown get-up and starts singing to little Timmy for his hatch-day, but Timmy is scared of clowns. Timmy's dad (Hannibal Buress) chastises Red for showing up late to the party, as well as for damaging the cake (which he carried in the egg). The dad refuses to pay for the cake, causing Red to snap and shove the cake in his face. As he tries leaving, Red accidentally cracks the family's new egg, making his face the first thing the hatchling sees.
Red lives on Bird Island in a house by the beach, away from the rest of the other flightless birds. As a kid, he was mocked for his huge eyebrows, and to this day, he still has no friends. He is put on trial by Timmy's family for his anger. Judge Peckinpah (Keegan-Michael Key) calls Red out for his anger issues, to which Red responds by pulling off his robe and showing he is a small bird standing on top of another bird named Cyrus (Tony Hale). Peckinpah then sentences Red to anger management classes.
Red begrudgingly goes to the class. He sees the welcome sign bird out front and is annoyed by the chuckle it makes. He chooses to ignore it until the sign knocks him in the head, and then he tackles it and hurls it against the hut. Red goes inside the hut and meets the teacher, Matilda (Maya Rudolph). She introduces him to the other attendants - Chuck (Josh Gad), a really fast bird who got in trouble for causing mischief with his speed; Bomb (Danny McBride), a bird who literally blows up under stress; and Terence (Sean Penn), a huge bird that only grunts and has apparently done unspeakable things. The birds then try yoga exercises to stay calm, but Bomb ends up exploding. After the class, Chuck and Bomb invite Red to hang out, but he turns them down. He goes home alone.
During the next class, the birds are told to write poems. Chuck recites his over his dismay regarding the welcome sign bird being trashed, and everyone knows it's Red. Terence punches him into the wall. Suddenly, all the birds on the island get curious when Stella (Kate McKinnon) announces something is coming, and they see a ship pulling onto the shore and knocking into Red's house. From the ship emerges a bearded pig named Leonard (Bill Hader) and his assistant Ross (also Tony Hale). They come from Piggy Island. Leonard says it's just the two of them, and he wants to befriend the birds. Red is suspicious, but everyone dismisses it as his anger for getting his house wrecked.
That night, the birds throw a celebration for the pigs' arrival. Leonard introduces them to trampolines and a giant slingshot. Leonard picks Red from the audience after numerous snarky comments, and Red gets launched into the beach. He is quickly joined by Chuck and Bomb as they decide to sneak onto the pigs' ship. After finding other trampolines and various other items, they discover dozens of other pigs stowed away on the ship. Red brings them all back to the village and accuses Leonard of lying. Leonard says they're his cousins and that he wanted to put on a cowboy show for them. The lead cowboy (er, cowpig?), Earl (Blake Shelton), gets his show going, while Peckinpah finds it more awful that Red decided to sneak onto the pigs' boat.
The pigs start to get comfortable on Bird Island, with all the other birds (except Red) taking pleasure in their stay. Red then gets suspicious when he sees Leonard eyeballing an egg. He gets Chuck and Bomb to help him spy on the pigs. They then decide to search for Mighty Eagle (Peter Dinklage), a legendary bird said to only be a myth, but also the protector of the island.
The three birds climb a mountain to reach Mighty Eagle, leaving Red to listen to Chuck and Bomb making noises that they think would be Mighty Eagle's battle cry. They then realize they climbed the wrong mountain, forcing them to take another long journey up the real mountain. They find the Lake of Wisdom, so Chuck and Bomb start swimming and drinking from it. Mighty Eagle then appears and starts peeing in the lake (to their horror and disgust). Unlike the heroic and muscular image they had of him, Mighty Eagle is older and fat. Still, Red is excited to meet his longtime idol. However, instead of helping the birds, Mighty Eagle just indulges in his prized possessions and his own theme song.
Red finds Mighty Eagle looking through his binoculars to spy on an old lady bird. When Red looks through it, he spots the pigs placing TNT and dynamite around the village. Red, Chuck, and Bomb rush back to the village and come across the pigs stealing the eggs while the other birds are attending a party the pigs threw for them. Chuck rushes into the party to warn everyone while Red and Bomb run to the ship. They grab onto the net holding all the eggs. Bomb climbs up the chain to try and blow it up, but Leonard and his henchpigs spray him with a hose, knocking him and Red into the water.
The next morning, all the birds in the village see the ruin of their homes and the loss of their eggs. Peckinpah approaches Red and expresses remorse for not listening to him when he suspected the pigs. When asked for a plan, Red says they must make their own boat and follow the pigs back to their island, and they are gonna have to get angry if they want their eggs back.
The birds build their boat and attach the giant slingshot to it. They arrive at Piggy Island outside the pigs' city. Leonard, who also happens to be their King Mudbeard, presents the eggs to the other pigs as they prepare to feast on them. The birds then set up the slingshot to launch themselves into the city. Matilda goes first, and she shoots explosive eggs out of her butt. Hal the boomerang bird (Anthony Padilla) goes next, but he ends up flying back toward the birds. Bubbles (Ian Hecox) follows, and he inflates to a massive size against the pigs. Stella follows, but she can't reach the castle. Red gets launched toward the castle as he bounces off a boulder. Chuck and Bomb go soon after him. Terence tries to launch himself, but he ends up breaking the slingshot.
Red, Chuck, and Bomb infiltrate the castle and find the room where the eggs are being stored. Using his super-speed, Chuck causes the guard pigs to turn on each other, leaving them free to run in and get the eggs. Unfortunately, they are being brought into the dining hall where they are ready to get boiled. Red is holding on to the top of the net and then tackles the pig lowering them into the pot so he can pull them up. Mighty Eagle then swoops down to join in the fight. Red helps him get the net of eggs away and out of the castle. As the birds try to escape, Leonard holds onto Red. The pull causes one blue egg to slip out of the net. Red stays behind to save it. Mighty Eagle flies away with the eggs, but the pigs are headed toward them on their planes. Bomb drops down and makes a huge explosion to stop them from flying off the ramp.
Red and Leonard fight for the egg, resulting in a huge boulder dropping them down to the bottom of the castle where the pigs keep their stash of explosives. Leonard has the egg and starts taunting Red, until Red calmly distracts him and pulls a box of TNT that makes Leonard slip and fall toward him. Red grabs the egg and waits for the giant pot to fall down so he can hide in it for protection, leaving Leonard to get blown up as the explosives go off, causing the whole city to be destroyed. The rest of the birds see the explosion as Mighty Eagle brings the eggs down. All the birds take their eggs back, except the parents of the blue egg. The birds then get sad as they think Red died, but he emerges from the rubble and pulls out three blue hatchlings that came from the egg. He brings them back to their parents.
Mighty Eagle gets all the credit for the egg rescue, but the birds are still thankful to Red for his heroics by rebuilding his home, this time in the village with everyone else. The hatchlings then sing a song for Red, which really moves him. Chuck and Bomb then invite Red to hang out, but he decides to stay home alone. The two are about to leave disappointed, but Red says he was joking and he invites them inside.
During the credits, the birds are dancing. The pigs, who somehow survived the explosion, are also dancing. Leonard then says he is hatching up a new scheme. Finally, the Blues sneak off to the slingshot and launch themselves together over the ocean before separating just like in the games.
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