The film centers on three men, Red Pollard, Charles S. Howard, and Tom Smith who come together as, respectively, the principle jockey, owner, and trainer of championship horse, Seabiscuit. The story follows the redemption of the three men as they rise from troubled times to achieve fame and success through their association with the horse. Red Pollard was the child of a wealthy family which was ruined by the Great Depression. In need of money, the family leaves Red with a horse groom. Eventually becoming a jockey, Red makes extra money through illegal boxing matches, which leave him almost blind in one eye. Charles Howard is shown as a clerk in a bicycle shop when he gets asked by a passing motorist to repair his automobile, a technology which has recently been introduced. Some years later, Howard is the largest car dealer in California and one of the Bay Area's richest men. However, his son is killed in an automobile accident while driving the family car. When Howard is unable to come out of his depression, his wife leaves him. On a trip to Mexico in order to obtain a divorce and to drown his sorrows, he meets Marcela whom he marries.
Howard then runs into Tom Smith, a horse trainer who has been homeless. Seeing Smith tame an aggressive horse, Howard hires him to take care of his newly acquired stable of horses. Later, Smith tries to get a jockey to ride Seabiscuit, but the jockey is frightened off when Seabiscuit rips off a bit of his shirt. Smith then turns to see Red Pollard fighting with other stable boys and sees in them a similar temperament as the horse. Thus, he decides to make him the jockey. The film then follows the three men as they begin to race Seabiscuit. It especially focuses on their efforts to provoke a race with War Admiral, the top race horse in the country. A match race is then decided on the 1st of November at Pimlico racetrack. While they wait for the date to come around and train Seabiscuit, Pollard is asked to exercise a race horse for an old friend. While they are on the track, two men suddenly start a tractor, spooking the horse. The horse rears, and Pollard falls off and is dragged along until he crashes into a wall, fracturing his leg. When the doctor reports that he will be unable to jockey again, Red suggests that Howard get George Woolf to jockey. Red then teaches George about Seabiscuit's handling and mannerisms. Seabiscuit beats War Admiral easily because of a secret that Pollard told George Woolf, which was to hold him head to head with the other horse so he gets "a good look at the Admiral". Afterwards, Seabiscuit is entered in a race at the Santa Anita Race track under George Woolf. While he is racing he gets injured and has to stop. Red Pollard helps him to recover and get fit enough to race again. The last race is again at the Santa Anita track, and Red Pollard races him this time after putting a special self-made brace on his own leg to keep it stable. George Woolf is also racing, albeit on a different horse. When Seabiscuit drops to last place and trails the pack of horses, George Woolf trails back to be with Pollard. After a short conversation, Seabiscuit gives Pollard the signal that he is ready to go. Seabiscuit then surges towards the pack of horses and Pollard steers him through them to win the race. The movie ends with Pollard narrating "You know everyone thinks that we found this broken down horse and fixed him, but we didn't, he fixed us, everyone of us, and I guess in a way we kinda fixed each other too."