New York City policeman John McClane (Bruce Willis) is visiting his estranged wife (Bonnie Bedelia) and two daughters on Christmas Eve. He joins her at a holiday party in the headquarters of the Japanese-owned business she works for. But the festivities are interrupted by a group of terrorists who take over the exclusive high-rise, and everyone in it. Very soon McClane realizes that there's no one to save the hostages -- but him.

Insurance worker C.C. Baxter (Jack Lemmon) lends his Upper West Side apartment to company bosses to use for extramarital affairs. When his manager Mr. Sheldrake (Fred MacMurray) begins using Baxter's apartment in exchange for promoting him, Baxter is disappointed to learn that Sheldrake's mistress is Fran Kubelik (Shirley MacLaine), the elevator girl at work whom Baxter is interested in himself. Soon Baxter must decide between the girl he loves and the advancement of his career.