With the war in Vietnam escalating in 1965, Airman Adrian Cronauer arrives in Saigon to work as a radio host for the US Army. He's met at the airbase by Sgt Edward Garlick. Garlick takes him to the radio station where Cronauer is introduced to Lt Stephen Hauk and Sgt Major Dickerson. Cronauer has been brought in as a comic host for the morning show, having worked on the island of Crete and gaining popularity with American servicemen there.
Dickerson and Hauk both lay out their agenda for Cronauer: the boisterous and wisecracking Cronauer will follow their programming to the letter. Cronauer immediately finds himself at odds with both officers who will not let him play rock n' roll music (it's considered too subversive in the war environment) and will read only censured news from the teletypes -- news items first have to be examined by twin servicemen who use red pens to block out any news that may be considered upsetting to US servicemen. Cronauer launches into his 1st broadcast with his catchphrase "GOOOOOOOOOOOOD MORNIIIIIIIIINNNNNNNG VIETNAAAAAAAAAAAM!!!" and the show is an instant hit with the young soldiers with the host spouting scatological humor, odd characters of his own creation, criticism of the war effort and American elected officials (including Richard Nixon and Lyndon Johnson) and celebrity impressions and blasting rock n' roll music in defiance of station rules. After his 1st broadcast, Cronauer receives accolades from all of his colleagues but derision from Hauk, who thinks the new upstart is too intense.
Garlick takes Cronauer to Jimmy Wah's, a local bar popular with US soldiers. After meeting the gay Wah himself, Cronauer catches sight of a young local woman dressed in white. Garlick tries to tell Cronauer that fraternization with locals is forbidden but Cronauer buys a couple of bicycles & sets off after her. She goes to a local school where another US soldier is teaching a group of Vietnamese citizens how to speak English. Cronauer, hoping to get a date with the young lady, bribes the teacher to let him teach the class. Cronauer breaks from the lesson plan and teaches the class American rock songs, American slang & how to curse in English as well. After the class ends, he tries to talk to the young lady, who is of a traditional Vietnamese family. Her brother, Tuan, tries to explain things to Adrian but Adrian is persistent and tells him that he appreciates his honesty & respects him. Tuan decides he'll help Cronauer meet his sister. Cronauer later meets her for a date but, in accordance with her traditions, her whole family shows up as chaperones.
Cronauer's on-air antics continue to annoy Hauk and Dickerson but the host's popularity with the soldiers continues to grow. Cronauer joins his colleagues at Jimmy Wah's after work and is able to finagle the attention of a few local prostitutes away from a few soldiers at the bar. When Tuan shows up and is invited to sit with Cronauer's group, the soldiers harass Tuan. Cronauer tries to talk the men down and a fight breaks out which causes injuries and damage. Dickerson chews Cronauer out for the incident, saying he has one strike.
One day, as Cronauer tries to leave for the day, he's stopped by Hauk who orders him into a long editing session for the interview conducted with Richard Nixon. Cronauer, aggravated that Hauk wouldn't let him leave to get lunch, edits the footage with himself as the interviewer asking Nixon very offensive personal questions. Hauk and Dickerson are not amused and cut off the recording.
While Cronauer enjoys some time off at Jimmy Wah's, Tuan suddenly appears & tells him to come with him to meet his sister. As they walk away from the bar, it explodes, killing three US servicemen and injuring many on the street. Cronauer helps carry the injured out of the place. He marches straight back to the station and the teletype room, grabbing the printed report of the bombing to the broadcast booth. He's stopped by Dickerson who harshly orders him to give up the report. Cronauer appears to comply until he gets on the air. Unable to do his usual comedy routine, he suddenly launches into an "unofficial" announcement of the bombing. Dickerson orders the broadcast to be cut off.
Cronauer is placed on temporary suspension. Hauk takes over the broadcast, promising to be funnier than Cronauer but fails miserably. Hate mail arrives at the station condemning Hauk and Taylor orders the lieutenant to reinstate Cronauer. Cronauer returns from Tuan's village where he'd been invited for a few days of convalescence. While there, Tuan's sister tells Cronauer that they can't have a relationship because of her family's tradition.
Dickerson places a phone call to the Army intelligence office about a road leading to a small village called An Loc. He's informed that the road is held by the Viet Cong and is an unsafe. Dickerson orders Cronauer and Garlick to drive to An Loc to interview locals. En route, their Jeep hits a mine and they're forced off the road. Both of them emerge from the wreck uninjured but they become lost in the jungle. A small detachment of Viet Cong find their jeep and begin to track them. In Saigon, Dreiwitz sees the report about the road to An Loc and later meets Tuan at the entrance to the base. Tuan tells him that Cronauer has been gone for hours. When one of the guards at the base tells him that Cronauer and Garlick went to An Loc, Tuan sets off looking for them. He steals a small delivery wagon and drives out to An Loc. He finds Cronauer and Garlick hiding out. Unable to start the truck that Tuan stole, they set off in the jungle and walk until a small unit of Huey choppers finds them.
Cronauer becomes further despondent with his superiors and tells Garlick that he's sick of being told what he can & can't say on the air and that he's thinking of quitting. Garlick is able to convince Cronauer to stay when they're stuck in a Saigon traffic jam and are surrounded by US soldiers in trucks, headed for a battle zone. Garlick identifies Cronauer to the men and an initially reluctant Adrian entertains them for several minutes until the traffic clears. He later dedicates the Louis Armstrong's "What a Wonderful World" to them.
In another meeting with Dickerson, Cronauer is informed that Tuan is actually a Viet Cong operative named Phan Duc To. When Cronauer scoffs at the notion of his friend being a spy and terrorist, Dickerson reminds him that Tuan rescued him from almost certain death twice -- at Jimmy Wah's, Tuan got Cronauer out moments before the bomb went off and disappeared almost immediately. On the An Loc road, Tuan was able to travel it without calling attention to himself or coming to harm from the Viet Cong. Dickerson further emphasizes the accusation by showing Cronauer pictures of Tuan's friends who were executed as terrorists. Dickerson tells Cronauer that he's forcing him out of his unit & that he'll have to leave the country. When Cronauer asks Dickerson why he's making an issue of his friendship with Tuan, Dickerson tells him straight that he doesn't like him, his on-air personality & antics & his attitude. As he leaves, Adrian openly insults Dickerson, who angrily follows him. He's stopped by Taylor who tells him he's transferring Dickerson to Guam. When Dickerson protests, Taylor tells him he's "just mean & this is only radio."
Cronauer finds Tuan's sister and demands to know where he is, telling her that Tuan is being hunted by Army intelligence and will be summarily executed. She takes him to her brother, who immediately runs. After a short chase, Cronauer finds him in a shady section of the city. Tuan angrily and sadly tells his friend that his country has been torn apart by war and that many of his family have been killed by American forces. Tuan disappears.
As he's being taken to the airport to leave, Cronauer gathers his English-language class for a game of baseball. He humorously teaches them all to play. Cronauer also gets the soldiers escorting him to join in as well. After the game is over and Cronauer is flying out of the country, Garlick plays a pre-recorded broadcast from Cronauer bidding farewell to his audience.