Laxman Singh Bisht (Salman Khan), an abnormal child who has been bullied by some children including Narayan and they call him "Tubelight". His father was an alcoholic bus driver. Laxman soon gets his brother Bharat (Sohail Khan) who defends him from same children who bully him in many ways including beating Narayan (Mohammed Zeeshan Ayyub) so no one ever dares to bully him. During school days, M.K Gandhi (known as Mahatma Gandhi) has arrived there to teach children everything about faith, courage and belief.
After India was freed from the rule of British, Laxman and Bharat's parents pass away and Gandhi gets murdered. They then grew up and their love of brotherhood gets stronger. Suddenly, when Indian border gets attacked by Chinese Soldiers, Indian Army starts recruitment of Soldiers for Kumaon Regiment in order to stop tension at the border. Laxman, Bharat and Narayan join but Bharat gets selected. Narayan is rejected because of knock knees and Laxman gets rejected because of his abnormalities, however, he gets offered a job as an informer/messenger for the army.
As Indian soldiers (including Bharat) reach Indian border (in which there was a huge tension), suddenly a war rages between India and China. Laxman too learns about it. Laxman suddenly meets a magician known as Gogo Pasha (Shahrukh Khan) and gets selected to test his faith to move a bottle, after some attempts he succeeds even when Narayan tries to tease him. Laxman again tries the same thing with Banne Chacha (Om Puri) but fails. Banne explains that "Faith moves a mountain" and also explains how will Laxman find and get his faith. Laxman suddenly observes an Indo-Chinese woman named as "Le Leing" (Zhu Zhu) and boy named as "Gu Won" (Matin Rey Tangu), he then informs some people and they try to attack but they fail. Banne Chacha gets angry about this and advises him to befriend the women and boy whom they tried to attack because M.K Gandhi has not hated Britishers but learned from them to free India from British rule. After some attempts, Laxman finally succeeds to befriend Lening and Gu. Laxman tries to explain Indian army about Gu and Lening but he fails.
During a war, Bharat and soldiers try to escape but get captured. Laxman learns about this and gets heartbroken, but Leing, however, consoles him to bring back his faith so he can get his brother back. Narayan tries to attack Gu but Laxman saves him. Narayan tries to convince Laxman not to befriend Chinese people or he will lose Bharat forever, but Leing explains Narayan that she and Gu are not only Chinese but Indians too. As Laxman tries to explain Narayan everything he learned from Gandhi (including a faith can move a mountain), Narayan challenges him to move a mountain and Laxman succeeds as he brought an earthquake. After some days, he learnt that 264 soldiers were martyred. He then tries again several times but soon he learns that he succeeded in doing something as he learnt that war is stopped and borderline emerged between India and China. They celebrate the happiness of end of the war, and Leing gets her lost father back in the process.
But suddenly, the war still continued in some parts and Bharat gets killed. After learning this Laxman gets shattered as he feels that people were right about him but Leing and Gu comfort him and bids farewell to return to Calcutta. Suddenly Gu, Leing and Laxman receive a news that Bharat is still alive but lost his memory and he gave his shoe to someone else. Laxman receives spare shoes from Narayan and enters medical camp with Banne, Gu and Leing. Laxman manages to get memories of Bharat back and gets reunited with happiness. In the end, Laxman narrates that Faith slowly wakes up, but when it wakes up, it lightens the world like "Tubelight" and Laxman is seen playing with Bharat.