The film opens with Fredrick and Eleanor Little (Hugh Laurie and Geena Davis) and their son George (played by Jonathan Lipnicki) on the day they are intending an adoption. George wants to go to the orphanage with them, but has to go to school. While George is at school, the Littles go to the orphanage where, among all the kids there, they fall in love with a thoughtful, observant mouse named Stuart (voiced by Michael J. Fox), who knows almost everything about the other children, having been at the orphanage for a long time. Despite the warnings of Mrs. Keeper (the woman in charge), who says that humans should not be adopting mice, the Littles decide to adopt him as their second son.
Immediately after getting home, Stuart meets Snowbell (voiced by Nathan Lane) the family cat, who immediately attempts to eat Stuart. George arrives home and is surprised when his parents introduce Stuart as his new brother. George at first thinks it is a joke, but is shocked when he realises they are being serious. That night, Snowbell visits Stuart and requests that he keep a low profile, so as to avoid getting seen by the other cats and damaging Snowbell's image (the alley cats would laugh forever if they heard that there was a mouse with a pet cat).
George is at first sullen and somewhat disappointed and treats Stuart with contempt. He eventually snaps at a family gathering when they encourage him to play "catch" with Stuart. Stuart also earns Snowbell's wrath when his friend, Monty the Mouth (voiced by Steve Zahn) visits for food. As Snowbell tries to keep him from seeing Stuart, Stuart makes a scene trying to get a cereal box from a cupboard. When he sees him and discovers he is a member of the family, Monty cannot contain himself. Enraged, Snowbell tries to kill Stuart, who narrowly escapes by fleeing into the basement. Here, Stuart learns that George keeps a playroom and the two interact and eventually, George comes to accept Stuart as his brother. Stuart also finds that George keeps a toy car just his size. They decide to work together to finish George's homemade model boat, the Wasp, for the Central Park Boat Race the following week.
Snowbell, however, isn't finished. He and Monty head to an alley that night to visit Smokey (voiced by Chazz Palminteri), a Mafia Don-like Russian Blue who is the leader of the alley cats. Since Snowbell doesn't want Stuart killed, he makes a plan with the alley cats to remove Stuart from the Little house. On the day of the 92nd annual Central Park boat race, the Wasp is finished, and they arrive at Central Park. But, George finds a problem when he discovers his nemesis, Anton is present at the race. At the same time, Stuart accidentally destroys George's remote control, rendering his boat inoperable. To make up for this, Stuart takes control of the boat himself. Anton, however, attempts to cheat by ramming his much larger boat into other boats and sinking them. When he attempts to do the same thing to Stuart's boat, Stuart manages to bite into the line of his sail, rendering Anton's boat inoperable. Stuart subsequently wins the race.
The celebration is short lived however, as during the party that night, the Littles are visited by Reginald and Camille Stout (voiced by both Bruno Kirby and Jennifer Tilly), a mouse couple claiming to be Stuart's parents. After discussion, Stuart reluctantly leaves with his real parents, taking the small car with him as a goodbye present from George and they go to their home, a small toy castle on a golf course. Three days later, the Littles are visited by Mrs. Keeper, whom they had asked to do a little background research on Stuart. She tells them that, according to the records Stuart's parents died several years ago after a pile of canned food fell on them. The Little's realised that Stuart had been kidnapped and call the police.
A terrified Snowbell rushes to the alley and warns Smokey and the others about the Littles' discovery. Smokey then decides that the only way to rectify things is to kill him. They call a meeting with Reginald and demand that he and Camille hand Stuart over. But the Stouts, having grown to care for Stuart, reveal the truth and Reginald orders him to escape before the cats find him. Stuart does so after saying goodbye to his "fake parents". Meanwhile, the Littles decide to place "missing" posters around the city to get help in finding Stuart. While going through Central Park, Stuart is ambushed by Smokey and a few cats. He manages to evade them by driving his car into the sewer, but at a cost: he loses the car and his luggage while escaping the storm drain. Eventually, Stuart finds his way home just as the Littles leave to hang the posters. The only one home is Snowbell, and he tells Stuart a lie about how the Littles are enjoying life without him, and shows him the family picture with Stuart's face cut out (the Littles had actually removed the picture to provide one for the Missing posters). Stuart leaves again. However, Snowbell sees the pain Stuart's absence has caused and realises his selfishness.
Discovering Stuart's location from Monty and the other cats, who intend to eat Stuart, Snowbell heads to Central Park and finds him sitting alone in a bird's nest. Snowbell, however, turns on the other cats and escapes with Stuart, admitting his lie to him and that the family actually does love him, he is in fact the only one who hates him. The cats catch up with them and Snowbell attempts to convince Smokey to call off the hit on Stuart, but is refused. Instead, Smokey orders the cats to kill both Stuart and Snowbell. Stuart responds by taking off Snowbell's collar and using it to lure the cats.
The cats give chase, and eventually corner Stuart hanging from a tree branch. The cats group together on a lower branch to catch Stuart, but Snowbell breaks it at the last minute and sends the cats into the water below. Smokey sneaks up behind Snowbell and is about to kill him when Stuart releases a thin branch that hits Smokey in the face and knocks him into the water. Enraged and humiliated, Smokey walks off, only to be killed by dogs upon turning a corner. Monty and the other cats also climb out of the water, whimpering and embarrassed. Snowbell and Stuart walk home and Stuart shares a warm reunion with his family, telling them that Snowbell helped him home. The Littles bring Stuart and Snowbell inside, and close the windows, ready for bed.