During World War One, T.E. Lawrence is a Lieutenant in the British army, stationed in Cairo. He is a bit of a misfit and is known to be very intelligent and very insolent. Despite protestations from his superiors, in particular General Murray, Mr Dryden, of the Arab Bureau, sends Lawrence to Egypt to assess the likelihood of Prince Faisal winning his revolt against the Turks.
The journey to Egypt starts very poorly. Lawrence's Bedouin guide is killed by Sherif Ali because he drank water without asking permission. Lawrence intends to speak out about the killing but is ordered by Colonel Brighton to mind his own business, assess the likelihood of a win for Prince Faisal, and get out as fast as possible. Lawrence promptly does no such thing and is very outspoken when he meets the Prince, who is fascinated by both his outspokenness and the depth of his knowledge of the area and the political implications of the revolt. Brighton again advises Lawrence to leave, but Lawrence again ignores him and proposes a daring attack on Agaba to surprise the enemy. If successful, taking Agaba would provide a port for the British to use to transport much needed supplies. The town is strongly defended against any possible sea attack from the sea but surprisingly open from the land. Lawrence persuades the Prince to give him fifty men who will be led by Sherif Ali, who clearly thinks the attack is doomed to fail. At this time Lawrence also acquires two manservants in the form of Daud and Farraj, two young orphans.
Lawrence's group cross the Nefud Desert which up until this point has been thought of as an impossible journey. Even the Bedouin believe it to be untraversable. They make it to an oasis but on discovering that they are a man down and that Gasim has fallen from his camel in a state of collapse, Lawrence goes back for him. This finally wins over Sherif Ali who now considers him an honorary Arab and burns Lawrence's British army uniform, replacing it with Arab robes. Lawrence then meets the leader of the powerful Howeitat tribe, Auda Abu Tayi, and persuades him to join the rebellion against the Turks. However, a blood feud between one of Lawrence's men and in of Aida's almost curtails the plan before it starts and to maintain their fragile alliance Lawrence pledges to execute the man himself. He is disappointed to discover that the murderer in question is Gasim, the man he went back for, but keeps his word and shoots him. The alliance secured, the Turkish garrison is taken the following morning.
Lawrence goes back to Cairo to meet his new superior officer, General Allenby, and to inform him, and Mr Dryden, of the victory over the Turks. During the journey Lawrence is promoted to Major. He is given money and weapons so that he can defend the Arabs. Lawrence is concerned that he is changing, and that he enjoyed killing Gasim. Allenby brushes his concern aside but Lawrence is already suspicious about the General's motives and asks him if there is any truth to the Arab's belief that the British want to control Arabia. Allenby denies this when Lawrence will not let the matter drop without an answer.
Lawrence launches and leads a full-fledged guerilla war. He blows up trains and sabotages the Turks who have no answer to his tactics. An American war correspondent writes about him and catapults him to international stardom. This does not prevent the raids continuing. At one such raid Farraj is badly wounded and knowing he cannot recover, but unwilling to leave him to die slowly, Lawrence shoots him.
Lawrence's luck runs out when he is scouting a city called Daraa with Sherif Ali. Both men are taken prisoner and are transported to the Turkish Bey. Lawrence is stripped, violated and beaten, then thrown into the street. Lawrence is both severely traumatized and greatly humbled by the experienced, abandoning his exploits and declaring that where once he had believed himself to be a god, he realizes he is a man. Wanting out of the desert he rejoins the British forces but cannot fit in there either. Allenby tries to persuade him to come to Jerusalem and participate in the Big Push in Damascus, but Lawrence is too emotionally damaged to consider returning. Allenby does not give in. He tells Lawrence his destiny is to lead and to live as a hero; Lawrence relents and believes he can gather men around him with his charisma rather than by offering them money. He recruits a motley but deadly army of men; murderers, mercenaries, misfits all who are motivated by the money and disinterested in the Arab cause. They see Turkish soldiers retreating and realize the soldiers have just murdered an entire village of people. One of Lawrence's men comes from the village and he demands they take no prisoners, but when Lawrence is hesitant the man charges the column of Turks on his own, and is killed. Lawrence leads his men in a massacre of the Turks and again finds that he enjoys killing. Afterwards he is distraught by what he has done. He then leads his men to take Damascus ahead of Allenby's army.
The Arabs set up a ruling council to run the city but they are inexperienced in these matters; most are tribesmen and have lived in the desert. There are tribal differences that go back generations that make it almost impossible for the mento govern with any accord at all. Despite Lawrence's urging they cannot successfully run the city and so the English take the city back and run it themselves. Lawrence is promoted to colonel but has outlived his usefulness both to the Arabs, who needed him to vanquish the Turks, and the British, who needed him to enable the retaking of Arabia. The movie closes with Lawrence being driven away in a staff car, as he goes home, dejected.
