Peter Venkman, Ray Stantz, and Egon Spengler are scientists at Columbia University investigating the paranormal. Following their first encounter with a ghost manifesting at the New York Public Library, the dean fires them and dismisses the credibility of their research. In response, they create “Ghostbusters”, a paranormal investigation and elimination service. They convert a disused firehouse, develop high-tech equipment to capture and contain ghosts, and convert a combination car into the “Ectomobile” to support their business.
Seeing their television ad, a skeptical cellist, Dana Barrett, is initially dismissive but reluctantly calls them after a paranormal encounter in her kitchen. Recounting the event, she describes opening her refrigerator and seeing a creature that utters a single word: “Zuul.” Venkman reassures her and becomes romantically interested, while Ray and Egon research her claims. Business is slow until they are hired to remove a ghost from the Sedgewick Hotel. There, Egon warns the group never to cross the energy streams of their proton pack weapons, as this could cause a catastrophic explosion. They capture their first ghost and deposit it in a special containment unit in the firehouse.
Soon their business booms as paranormal activity increases across New York City. To cope with demand, they hire a fourth member, Winston Zeddemore. Suspicious of their operation, Walter Peck, an Environmental Protection Agency inspector, asks to evaluate their equipment but leaves after Venkman insults him. Privately, Egon warns the team the increase in supernatural activity is becoming dangerous and their equipment is at risk of failing under the stress.
Venkman meets with Dana. He shares that Zuul was a demigod worshiped as a servant to “Gozer the Gozerian,” a shape-shifting god of destruction. He convinces Dana to discuss her case further over dinner. However, when Dana returns home, she is supernaturally assaulted and possessed by Zuul. In a nearby apartment, a nearly identical entity manifests, then chases and possesses her neighbor, Louis Tully. Venkman arrives and finds the possessed Dana/Zuul claiming to be “the Gatekeeper.” Louis, also possessed, is found by police officers and claims he is “Vinz Clortho, the Keymaster of Gozer.” The Ghostbusters agree they need to regroup but keep the pair separated.
Peck returns with law-enforcement and city workers to have the Ghostbusters arrested and orders the deactivation of their ghost containment system. Stressed beyond capacity, the shutdown causes an explosion that releases the captured ghosts, and the Ghostbusters are detained. Louis/Vinz manages to escape in the confusion and makes his way to the apartment building where he meets Dana/Zuul. In jail, Ray and Egon reveal that Dana’s building is the true source of the supernatural increase. The architect was a genius and cult leader of Gozer-worshippers, who designed it to channel ghosts for the purpose of ending the world. Faced with chaos in the city, the Ghostbusters convince the mayor to release them over Peck’s protests.
On the apartment building roof, Dana/Zuul and Louis/Vinz open the gate between dimensions and transform into supernatural creatures just as the Ghostbusters arrive. Gozer, in the form of a woman, arrives, and Ray attempts to reason with her first. When this fails, Gozer attacks, forcing the Ghostbusters to attempt to trap her, but she disappears. Her disembodied voice demands the Ghostbusters “choose the form of the destructor.” Raymond inadvertently recalls a beloved corporate mascot from his childhood, and Gozer reappears in the form of a giant, “Stay Puft” marshmallow man that proceeds to attack the city. Egon tells the team to ignore his earlier advice and cross their proton energy streams at Gozer’s portal. The resulting explosion destroys Gozer’s marshmallow man form, banishes it from this dimension, and closes the portal. The Ghostbusters rescue Dana and Louis from the wreckage and are welcomed on the street as heroes.