Sanshirō Sugata journeys to Tokyo in 1882 seeking jujutsu mastery. Witnessing Shogoro Yano, a judo master, effortlessly defeat multiple jujitsu practitioners instantly redirects Sanshirō's path; he abandons his initial quest to become Yano's judo disciple.

Sanshirō possesses immense physical strength and potential but lacks discipline and self-control. Yano recognizes this raw talent yet criticizes his lack of humanity, likening teaching him judo to "giving a knife to a madman" due to Sanshirō's propensity for street brawls and impulsive violence, highlighting his struggle between physical prowess and spiritual immaturity.

Chastised by Yano, Sanshirō undergoes a transformation: he leaps into a cold lotus pond in defiant dedication, clinging to a stake for a day and night. Witnessing a lotus bloom during this ordeal sparks a spiritual awakening, symbolizing purity and self-realization. Emerging humbled, he seeks Yano's forgiveness, marking his first step toward grasping judo's deeper spiritual principles beyond combat and integrating skill with inner peace.

Progressing in training, Sanshirō emerges as a leading Shudokan Judo student. His growth faces tests in competitive matches against rival schools. He defeats jujutsu practitioner Saburo Kodama in a bout tragically resulting in Kodama's death. Later, representing his school, Sanshirō triumphs over Hansuke Murai, head of a rival jujitsu school, inflicting severe internal injuries that force Murai's submission. This victory establishes judo's supremacy and Sanshirō's reputation.

Following the match, Sanshirō develops respect for the defeated Murai and romantic feelings for Murai's daughter, Sayo. This attraction conflicts with Gennosuke Higaki, a jujutsu master also vying for Sayo. Higaki challenges Sanshirō to a duel; Sanshirō accepts and emerges victorious, crippling Higaki. The portrayal suggests a complex, almost sympathetic view of the villainous Higaki, indicating Sanshirō's confrontation with a darker potential version of himself.

Later developments depict Sanshirō continuing as a judo master. He confronts American boxers and rival karate masters, navigating moral conflicts between dojo rules and protecting the defenseless, often choosing the latter. His victory against an American boxer demonstrates Japanese judo's superiority over Western boxing. He also confronts the brothers of his former rival, Higaki, cementing his role as a guardian figure.

Sanshirō's evolution traces the shift from brute force to mastery encompassing technical skill ("judo") and spiritual enlightenment ("satori"), emphasizing calm acceptance of nature's law and pursuit of inner truth. His relationship with Yano represents an idealized mentor-student dynamic. Conflicts, particularly with Higaki, explore human duality and violence within skill. His story symbolizes Meiji-era tension between traditional jujutsu and emergent, spiritually focused judo, positioning him as an agent of modernization in Japanese martial culture.

Sanshirō's background draws inspiration from historical figure Shiro Saigo, one of the "Four Guardians of the Kodokan." Like Saigo, Sanshirō is a formidable but initially undisciplined fighter, known for agility, resilience, landing on his feet when thrown ("The Cat"), and exceptional balance ("Octopus feet"). While the film illustrates his combat agility, it omits Saigo's signature "Yama Arashi" throw, focusing on Sanshirō's spiritual and ethical maturation.