‘Phata Poster Nikla Hero’ is about Vishwas Rao, who in his tryst to be a hero, ends up becoming a fake filmi cop. But fate offers him funnier choices.

The movie starts off with Vishwas Rao (Shahid Kapoor) who is raised by his mother, Savitri (Padmini Kolhapure), who hopes that her son will grow up to be a brave Inspector. But Vishwas wants to become an actor. Dressed as a Police Inspector for a photo shoot, he meets social worker Kajal (Ileana D'Cruz) during a car chase. Kajal mistakes him as an inspector and thanks him for helping her catch the goons, while Vishwas plays along. He is mistakenly published in the newspaper as an Inspector, which Savitri sees. She arrives in Mumbai to see her dream come true, and circumstances lead Vishwas to carry on his lie not only to Kajal, but also to his mother.

While shooting for a film, Vishwas's mother comes to know that he is not an inspector. She faints and is admitted in the hospital, where the doctor tells him that she needs to be operated and the amount required is rupees ten lakhs. He agrees to work for Gundappa (the boss of the goons Vishwas and Kajal caught) for money where he needs to bring a CD for them. While escaping after getting the CD he is caught by police and accidentally shoots two police officers. Since he became a murderer he was left with no other choice than to join Gundappa's gang. Meanwhile, Kajal, who is under the impression that Vishwas has gone bad, along with some men plans to save him from doing any crime? So they go to the gangs den purposely and tells the foolish Gundappa that she came to marry Vishwas. Hence, creating a confusion so that Gundappa leaves Vishwas. On the other hand, Joint Commissioner (who was also kidnapped) tells Savitri that Vishwas is actually not doing any crime rather is working for the police. Kajal knows this from Savitri later and goes to apologise to Vishwas for misunderstanding him. Not knowing that they are being watched on CCTV, she apologises to Vishwas and leakes details of his plans. Somehow, Vishwas and his mates are able to flee. But his mother and Kajal are held by Napoleon (the ultimate Don, boss of Gundappa). After fighting the goons, Vishwas hands over Napoleon (who is earlier revealed to be his own father) to the police and tells everyone that he will become a police officer as they are real life heroes. He did all the filmy actions as a fake police officer now he wanted to be a real police man and do his duty for his country and his mother's dreams finally fulfilled.

At the end, in a comedy of errors and events, through heartbreak and hilarity, emotion and eccentricity, Vishwas flips between fake herogiri and asli heroism.