The film starts with a newscast about a year after the attack on Lake Victoria by prehistoric piranhas, an eradication campaign has left the lake uninhabitable by life, and the town itself has been largely abandoned as a result of the drying-up of their main revenue source, tourism. The beaches have dried up and there is no longer Piranha in the lake. No explanation is given about the fates of the original survivors.
At a nearby lake, Clayton (Gary Busey) and Mo walk into the water to recover the body of a dead cow. The viewer finds out that eggs have been laid inside the cow and the metabolism is forcing the eggs to come out via farting from its rear end. Oblivious to the danger, the Piranha bite and swarm onto the two farmers. Mo is completely devoured and disappears under the water leaving his hat bobbing into the crimson of his blood. Clayton makes one more bid for freedom, jumping out of the water. Alas he doesn't make it far and in one last bid to show the Piranha that he can't be beaten, he pulls one off his face and bite it's head off. He then spits it out towards the camera as the other Piranha rip him to shreds under the water.
A young woman named Maddy (Danielle Panabaker), a marine biology student, returns home for the summer to the waterpark she co-owns with her sleazy step-dad called Chet. She finds to her horror that her step-father Chet (David Koechner), plans to add an adult-themed section to the waterpark with 'water-certified strippers', and re-open it as "Big Wet." There will be a family friendly part for the kids but he is proud to show off his big investment which is the Adult pool. Maddy finds that the adult part is littered with topless and fully naked women and a camera that shows their naked genitalia as they get out of the pool. An employee called Big Dave is busy having sex with a water inflow pipe in the pool. At a party at the waterpark that night, Maddy encounters several old acquaintances, including her policeman ex-boyfriend Kyle (Chris Zylka), and Barry (Matt Bush) who has secretly been in love with her since grade-school. She also runs into two of her close friends, Ashley (Meagan Tandy), and Shelby (Katrina Bowden).
Shelby and her boyfriend Josh (Jean-Luc Bilodeau) go skinny-dipping in the lake, where a piranha makes its way inside her vagina and she thinks it was something perverse that Josh has done. Meanwhile, Ashley and her boyfriend Travis (Paul James Jordan) go to have sex in their van. They accidentally trip the handbrake, causing the van to roll into the lake. As the water starts coming in, they both scramble to find the key to open the handcuffs. Fearing for both of their lives, Ashley decides to make a break for it and swim to get help. This proves to be a fatal mistake as the Piranha get in and start to devour Travis, particularly his hand that is cuffed to the pole. Ashley manages to make it on the roof of the van. She looks into the back window to see if Travis is ok and his bloody stump smashes through the glass before he sinks beneath the water and the Piranha devour the rest of the half dead Travis. Ashley sits on top of the van screaming for help. It is later shown that she did die via the piranha as what is left of her body is lying motionless on the lake's floor.
The next day, Maddy is trying to console Shelby about their missing friends. While sitting on a jetty, they are both attacked by the swarm of piranhas which proceed to break the wooden planks apart. Shelby jumps to a floating piece of the jetty but Maddy knows it is not safe. So she tells her to jump back and they only just make it to the sand when a Piranha bursts from the water to bite Maddy. Maddy's quick impulse comes into play when she grabs the Piranha and throws it down on the sand. She then picks up a rock and begins to batter it to death. Blood seeps out of the body of the Piranha and she thinks it's dead. She goes to poke it and the Piranha gives one last snap at her before it dies. Maddy, Kyle and Barry go to Lake Victoria's pet reserve and ask Mr. Goodman (Christopher Lloyd) how they can stop it. He conducts an experiment with the original Piranha that was captured by placing a sheet of steel between it and a small frog. The Piranha manages to bite through the sheet of steel and is just about to get the frog when Barry quickly pulls it out and Goodman curses him for saving it. He informs them that the Piranha may be moving via sewage pipes and underground rivers between lakes. The trio return to the lake, where they establish that the piranhas cannot make their way into the outflow pipes connecting the lake and the waterpark. Maddy swims down to check the pipelines and make sure the safety grates are still intact. Just then a shoal of Piranha begin to attack her and she frantically swim for the shore. She manages to make it out without serious injuries.
With the Piranha inside her vagina, Shelby tells Josh she doesn't feel so good, and ask him to have sex with her to make her feel better. She thinks she is dying and doesn't want to die a virgin. While Shelby and Josh are having sex, the piranha in Shelby's vagina bites Josh's penis, forcing him to wrestle with it round the room before finally having to chop the organ off with a knife. Shelby wakes from her seizure and goes in search for Josh. She finds the head part of his penis on the floor right next to the Piranha with a pool of Josh's blood. She turns around to find Josh holding the knife and screaming to her about what has she done to him. Both are hospitalized. Kyle is revealed to be corrupt and taking pay-offs from Chet, who is secretly pumping water from an underground river into the water park. Before he leaves Chet's company, he writes him up a speeding ticket to which Chet rolls up and throws away calling Kyle a crooked cop.
"Big Wet" finally has it's big opening. Among the first guests are Deputy Fallon (Ving Rhames), who survived his previous ordeal with the piranhas but lost his legs, and former cameraman Drew Cunningham (Paul Scheer). While the duo attempts to overcome their fear of the water after they were attacked a year ago. Fallon calls the water a pussy and tells Andrew to push him in. Andrew begins to and Fallon pleads with him not to dump him in the water. Andrew backs off and again Fallon tells him to tip him in. Andrew sighs and goes again to tip him in. Again Fallon pleads and begs not to go in. A beautiful woman tells Andrew off for trying to push Fallon in. Andrew tells her that Fallon wants him to do it to which Fallon replies that he doesn't. Andrew is called a bully and scolded for trying to push Fallon in. Andrew again backs off and Fallon says he ain't afraid of some pussy ass water. David Hasselhoff also makes an appearance as a celebrity lifeguard. A boy is bitten by a Piranha on his leg and tells his mum who tells him that it wasn't. He walks up to Hasselhoff to ask for a band-aid. Hasselhoff thinks he is a fan and gives him an autograph but the boy doesn't know who he is. Hasselhoff starts to go through every show he was on from baywatch to Knight Rider and even SpongeBob Squarepants the movie and still the kid says he has never heard of him. Hasselhoff decides he has found a new friend but the kid walks off and goes back into the pool.
Discovering the connection between the park and the underground river, Maddy attempts to shut the waterpark down, but is stopped by Chet and Kyle. The piranhas make their way to the area and attack, killing many of the lifeguards and waterpark-goers. Big Dave ends up having a Piranha stuck in his bum. The little boy who mey Hasselhoff starts to get attacked again by the Piranha. Hasselhoff hears the boy's cries for help and calls him a stupid ginger little moron. Deputy Fallon attaches a shotgun prosthesis to his legs in order to save the visitors. He walks into the water and a Piranha tries to bite his legs. He says aloud to the Piranha that his new legs are titanium and then proceeds to blow them out of the water with the shotgun. Hasselhoff, after rescuing the small boy, becomes pleased that he has finally become a real lifeguard and instead of thanking Hasselhoff, the kid just wants to be let go. In the chaos, Chet decides to make an escape and finds a little girl crying over her savagely mutilated and dead mother's body. Feeling sorry for the child he gives her some of the money he got from the opening and gets into a golf buggy. He reverses by accident and runs over the poor little girl. Knowing that he has done this, he tries to make a speedy getaway. Although he wasn't paying attention to where he was going and accidently runs into a banner wire which slices through his neck. As the cart crashes, his head is sent flying from his body and into his beloved adult pool were his head lands between a bloodied woman's DD's before being sent flying into the pool water where Piranha munch on his dead flesh. The camera shows the piranha eating his head.
Maddy tells Barry that the only way to stop them is to shut down the pumps and suck the water out of the pools. Barry begins to drain the pools; however Maddy, who is rescuing people from the water, becomes caught in the suction and dragged down to the bottom of the pool where a oversized Piranha sees her as an easy menu. Barry sees the piranha and throws the trident he carries straight into the Piranha's head, killing it instantly. After Kyle refuses to save her, Barry, despite being unable to swim, leaps down into the water with a oversized rock to pull him down and brings her to the surface. Barry performs CPR and Maddy comes back to life and pukes water into his mouth. She opens her eyes and finds that Barry saved her life and she kisses him in gratitude. Barry seems happy that he was Maddy's knight in shining armor.
Big Dave pours concentrated Chlorine into the pipes as revenge for the attack on his bum, followed by a lit cigarette. The resulting explosion kills most of the piranhas and sends Barry's litter trident into the air. Kyle overcome with combined guilt for leaving Maddy to die and allowing Chet to siphon water from the lake, hops into action trying to save dead caresses of the bathers. Shocked after seeing Maddy in the arms of Barry, Kyle stops for a moment and is killed by the falling trident. The celebrations are cut short however, when Maddy takes a phone-call from a horrified Mr. Goodman, who informs them that the Piranha are evolving and are now able to move on land. The tank that was holding the original Piranha has a smashed hole in it giving the impression that the Piranha has escaped and is loose in the shop. The film ends as one such piranha emerges from the pool and looks like it's hopping or jumping. Snapping its jaws, it leaps up and decapitates a young boy taking pictures of it with his phone. The mother screams in horror as Hasselhoff casually replies "you stupid ginger little moron."
The credits shows the leftovers of the poor boy and some bathers looking at the remains and the hopping Piranha.