Betty (Renee Zellweger), is a kind and considerate diner waitress living in Kansas City, Kansas. She is a fan of the daytime soap opera 'A Reason to Love'. She has no idea that her sneaky husband, Del (Aaron Eckhart), a car salesman, is having an affair with his secretary and that he intends to leave Betty in order to pursue a relationship with the secretary. She also doesn't know that her husband supplements his income by selling drugs out of the car dealership.
When Betty calls to leave a message about borrowing a Buick LeSabre for her birthday, her husband tells Betty to take a different car as the LeSabre has stolen drugs hidden in the trunk.
Two hitmen (Morgan Freeman and Chris Rock) show up at the house with Betty's husband. The hitmen torture Del into revealing that he has hidden the drugs in the trunk of a car but are not successful in getting him to tell which car it is. Betty witnesses the murder and experiences a fugue state, escaping the reality of murder into the comforting fantasy of the soap opera. In her mind, she assumes the identity of one of the characters in the daytime drama, a nurse.
That evening, Sheriff Ballard (Pruit Taylor Vance), Roy Ostery (Crispin Glover) a local reporter, and the police are examining the crime scene while Betty calmly packs a suitcase. She seems oblivious to the murder, even with the investigation going on right in her house. At the police station, a psychiatrist examines her.
Betty spends the night at her friend's house in a nearby town, sleeping in a child's bedroom with the innocence of a little girl. In the middle of the night, she suddenly gets in her car and drives off. Betty's next stop is a bar in Arizona where the lady bartender talks about her inspiring vacation in Rome, and Betty tells her that she's engaged to a famous surgeon (describing the lead character from 'A Reason to Love'... not the actor who portrays him, but the character himself).
Meanwhile, the two hitmen are trying to find her, as they have finally realized that she must have the car with the drugs. As they search, Charlie (Freeman) begins falling in love with his image of Betty, to the consternation of Wesley (Rock).
The next day, Betty arrives in Los Angeles and tries to get a job as a nurse while looking for her long-lost "ex-fiance". She is turned down, due to lack of a resume or references, but does manage to get a job in a local pharmacy due to her help in saving the life of the victim of a drive-by shooting.
Despite an injunction against "touching" the patients, Betty becomes popular with them and their families. She ends up living with Rosa (Tia Texada), a Hispanic legal secretary who has had a series of painful love affairs and offers to help Betty find her surgeon friend. However, Rosa learns that "David" is a just soap opera character, and she goes to the pharmacy window to confront her. Betty just thinks her friend is jealous and is impervious to the revelation.
Meanwhile, a lawyer has an idea and supplies tickets to a charity function where George (Greg Kinnear), the actor portraying David, will be making an appearance. Betty meets George at the function whom he addresses to his soap opera character of David. George is inclined to dismiss her as an over-imaginative fan, but something about her compels him to walk back and talk to her some more. He begins to think that Betty is a struggling actress determined to get a part in the soap opera, so he decides to play along. After three hours of her "staying in character," he takes her home.
George begins falling in love with her and he and his producer decide to bring her onto the show as a new character: Nurse Betty. When Betty arrives on set, she finally falls out of her fantasy world and back into real life as seeing the inner workings of a television show snaps her back into reality. After two failed takes, she realizes that she is on a set and that the all people around her whom she thought were real are just actors portraying characters. George confronts her for being a "crazy person" and Betty walks out of the studio.
Now recovered, Betty begins to tell Rosa what happened, when the two hitmen, Charlie and Wesley, come into the house to kill them as not to leave any loose ends when they discover the car containing the drugs outside. The killers are in turn interrupted by the reporter Roy Ostery and Sheriff Ballard from Betty's home town who have also tracked her down and a hostage situation develops.
When Wesley is distracted by Roy who turns on the TV set to watch the soap opera, Ballard pulls out a gun hidden in an ankle holster and shoots and kills Wesley. At this point, Charlie flees to the bedroom with Betty where he reveals to her that Wesley is his son. Charlie, rather than being arrested, decides not to kill Betty, and commits suicide by attemping to escape and in so doing is apparently gunned down by the police.
Betty decides to stay in Los Angeles and try to rebuild her life. She is offered a job on the show by George, and she accepts. She appears in 63 episodes and then takes a vacation in Rome. Betty plans to pursue nursing as a career and decides to try out a relationship with George, while her former roommate, Rosa, begins a relationship with Roy.