Plot

A drop of sunlight falls to the ground and grows into a magical flower with healing powers. A woman named Gothel (Donna Murphy) uses it to keep herself young by singing to it.

Centuries later, a queen from the Kingdom of Corona becomes ill while pregnant, and the king orders a search for the legendary flower. His knights find the flower (as Gothel failed to conceal it properly during her haste to get away from the approaching Knights) and cut it to bring to the king. The queen is healed after being fed the flower, and gives birth to a daughter, Rapunzel (Mandy Moore), whose golden hair has absorbed the abilities of the flower. The Kingdom was adorned with the standard of a Golden Sun everywhere. The King and the Queen gift Rapunzel a tiara, while she was still a baby. To celebrate her birth, they launched a flying lantern into the sky.

The flower no longer has magical powers since it has been cut, so Gothel tries to steal a lock of Rapunzel's hair. However once cut, the hair turns brown and loses its power. So, she kidnaps Rapunzel to raise as her own child in a well-hidden high tower, telling her it is for her own safety. Rapunzel would sing the special song, making her hair glow, turning back Gothel into her youthful self.

Every year, on Rapunzel's birthday, her parents and their subjects release thousands of sky lanterns, in the hope that the lost princess will return. As Rapunzel grows, her hair also grows to be enormously long, but Gothel cannot cut it, as they would lose their powers. Rapunzel spends her days inside the tower, attending to the chores and painting murals on the walls of the tower. There is no exit from the tower and Gothel climbs in and out of it, by using Rapunzel's long hair as leverage.

Rapunzel is fascinated by the annual lights and for her 18th birthday, Rapunzel asks Gothel for permission to go outside the tower to see the source of the annual floating lights, but Gothel refuses, claiming the outside world is too dangerous. Gothel then leaves for her daily trips to get supplies for the tower.

Meanwhile, Flynn Rider (Zachary Levi) and the Stabbington brothers (Ron Perlman) steal the tiara of the lost princess from the Kingdom's castle. During the ensuing chase, Maximus, horse of the Captain of the Guards (M. C. Gainey), is separated from his rider but continues to pursue Flynn on his own. Flynn outwits his accomplices, takes the tiara, and fights Maximus. Together they fall into a deep ravine and while hiding from Maximus, Flynn stumbles upon Rapunzel's tower. He climbs up into the tower but is knocked unconscious with a frying pan by Rapunzel who puts him in a wardrobe. Rapunzel finds the tiara in Flynn's satchel.

When Gothel returns, Rapunzel tries to show her the captive Flynn to prove she is capable of handling the outside world, but Gothel cuts her off by saying she is never leaving the tower. So, Rapunzel instead asks Gothel for a special paint, the ingredients for which require three days of round-trip travel.

Gothel leaves, and Rapunzel tells Flynn that she will give him the tiara back if he takes her to see the lights. Flynn agrees after his charms fail to have any effect on Rapunzel and she would not release him from the bonds made from her hair, till he agreed. As Rapunzel steps off the tower, she is amazed at nature and all its gifts that she experiences for the very first time. But she oscillates between the thought of never going back and the thought of Gothel being angry with her. Flynn realizes that Rapunzel has a fear of ruffians and thugs, instilled in her by Gothel.

While on route, he takes her to the Snuggly Duckling Inn, which is full of Gaul thugs such as Hook Hand (Brad Garrett), Big Nose (Jeffrey Tambor) and Short (Paul F. Tompkins), in hopes of scaring her into giving up her quest. The thugs recognize Flynn and capture him for the palace reward. The thugs, however, are charmed by Rapunzel, who encourages them to follow their dreams.

Meanwhile, Gothel encounters Maximus in the jungle, who is a palace horse, without a rider. She immediately turns back to the tower. Mother Gothel returns early to the tower (she uses a concealed emergency entrance to climb up) to find Rapunzel gone but finds the tiara & the wanted sketch of Flynn which was also in Flynn's satchel. She then teams up with the Stabbington brothers so she can get Rapunzel back and the brothers can get revenge on Flynn. Flynn had earlier ditched the Sabbington brothers to escape the palace guards. The brothers escape custody inside the tavern when the guards go after Flynn through the secret passage. Gothel watches everything going on in the tavern through a window.

Meanwhile, the guards invade the tavern, and Maximus finds the passage through which Rapunzel and Flynn escaped. They chase Rapunzel and Flynn to a dam which collapses when Maximus removes the logs holding the dam up to chase Flynn across a chasm. Flynn and Rapunzel become trapped in a flooding cave. Believing he is about to die, Flynn admits his true name is Eugene Fitzherbert. Rapunzel admits her hair glows when she sings, then realizes they can use her hair light to find a way out. Rapunzel later uses her hair to heal Flynn's injured hand. Rapunzel tells Flynn about the magical qualities of her hair and how her mother has never allowed her to cut her hair or step out of the castle. Flynn is moved by Rapunzel's love for her mother, even though it is clear that she has been harsh on Rapunzel. Flynn tells Rapunzel that he was an orphan who dreamed of being like the storybook hero that inspired his alias, but Rapunzel tells him she likes Eugene better than Flynn.

When Flynn goes to gather firewood, Gothel meets Rapunzel insisting that Flynn does not care for her and gives Rapunzel the tiara, suggesting that she test Flynn by giving it to him.

The next morning, Maximus, who is still searching for Flynn to retrieve the tiara, confronts Flynn but Rapunzel befriends the horse and convinces him to help them instead. Rapunzel and Eugene enter the kingdom and attend a festival in honor of the "lost princess". After a day of celebration, they sail onto the lake to watch the release of the lanterns.

There, Rapunzel gives Flynn back the tiara and they confess their mutual love. Flynn spies his old accomplices and leaves Rapunzel to give them the tiara, realizing that he cares more for Rapunzel. However, the brothers tie him up on a boat and sail him across the lake. They claim Flynn betrayed Rapunzel as they attempt to kidnap her for her hair's power, but Gothel rescues her and takes her back to the tower. Later, reflecting on what she had seen during her adventure in the kingdom, Rapunzel realizes she has subconsciously incorporated the kingdom's standard, a golden sun, into her artwork throughout her life. Rapunzel realizes she is the lost princess and attempts to flee the tower.

Meanwhile, Flynn is arrested and sentenced to death, but he is rescued by Maximus and the Gaul thugs from the inn. Flynn races and climbs up back to the tower where Gothel stabs him from behind and prepares to take a struggling Rapunzel to a new hiding place. Rapunzel tells Gothel that she will stop resisting if she can heal Flynn. Gothel agrees, but before Rapunzel can heal him, Flynn cuts her hair which subsequently turns brown and loses its power causing Gothel to age rapidly, fall out of the tower, and turn into dust. With his last breath, Flynn declares his love for Rapunzel who cries, and the healing power of her tear revives him. Returning to the kingdom, Rapunzel is reunited with the King and Queen. Flynn then closes the film, telling the audience that he readopted his original name, and he and Rapunzel eventually get engaged and married.