In rural Texas, go-go dancer Cherry Darling, resigning from her low-paying job, runs into her mysterious ex-boyfriend El Wray at the Bone Shack, a restaurant owned by brothers J.T. and Sheriff Hague. Meanwhile, the demented Lt. Muldoon and his men are making a transaction with chemical engineer Abby for mass quantities of DC2 (codename “Project Terror”), a deadly biochemical agent. When Muldoon learns that Abby has an extra supply, he attempts to take Abby hostage. The latter intentionally releases the gas into the air, mutating most of the town’s residents into deformed zombies. The infected townspeople are treated by the sinister Dr. William Block and his unhappy, unfaithful wife, Dakota, at a local hospital.
Random attacks begin along the highway, causing El Wray, with Cherry, to crash his truck. In the aftermath, several zombies tear off Cherry’s right leg. At the hospital is another victim, Tammy, the former lover of Dakota (whose car had broken down earlier, leading to her getting attacked by zombies on the road). Block recognizes her and compares text messages on Tammy’s and his wife’s phones, realizing Dakota was about to leave him. He then stabs Dakota’s hands with her anesthetic syringe needles repeatedly, rendering them useless, before locking her in a closet to tend to other patients, including Cherry, who is still alive.
El Wray is detained by Sheriff Hague based on past encounters between the two. As the patients mutate, El Wray leaves the station and arrives at the hospital, attaching a wooden table leg to Cherry’s stump. As El Wray and Cherry fight their way out of the zombie-infested hospital, Dakota escapes in her car, despite accidentally breaking her left wrist as her hands are still numb. Meanwhile, Block becomes infected along with others, while Cherry and El Wray take refuge at the Bone Shack.
Dakota retrieves her son Tony and takes him to her father, Texas Ranger Earl McGraw. Tony, given a revolver by his mother, accidentally shoots himself in the face after being told not to point it at himself. Cherry and El Wray make love in J.T.’s bedroom. Due to a “missing reel”, what happens after this is unknown; when the film returns, Sheriff Hague has been shot in the neck by one of his officers, zombies are massing outside the burning Bone Shack and El Wray’s true identity is implied by Hague. Dakota, Earl, Cherry’s former boss Skip, and Tony’s crazed babysitter twins arrive at the Bone Shack. With Hague badly injured, the group decides to flee to the Mexican border, before being stopped by a large mass of zombies. Muldoon’s men arrive, killing the zombies before arresting the group. Abby tells them that the soldiers are stealing the gas supply because they are infected, constant inhalation of the gas delays mutation. They also learn that a small percentage of the population is immune, suggesting a possible treatment, which is why Muldoon quarantined the survivors.
As Cherry and Dakota are taken away by two soldiers, the others defeat the security guards. J.T. sustains a gunshot wound in the process while the group searches for Muldoon. Discovered by El Wray and Abby, Muldoon explains that he killed Osama bin Laden before he and his men were infected and were ordered to protect the area. El Wray offers a respectful recognition of Muldoon’s military service before he and Abby shoot the mutating Muldoon.
Meanwhile, Cherry is forced to dance by the first soldier held at gunpoint. Eventually, she breaks her wooden leg across his face and stabs him in his eye with it. Dakota, after realizing her hands have regained feeling, quick-draws her syringe launcher and stuns the second soldier. El Wray and Abby arrive to rescue Cherry and Dakota, and El Wray replaces Cherry’s broken wooden leg with a modified M4 Carbine assault rifle with an M203 grenade launcher. She promptly kills the first soldier and several zombies with it.
J.T., wounded and lying beside his dying brother, stays behind to detonate explosives to eliminate the remaining zombies while the others flee. The survivors make plans to escape by stealing helicopters but must fight past the remaining zombies. Abby dies, along with hope for a cure, when a ballistic projectile blows his head up. The survivors use the blade tips of their helicopter to kill the rest of the zombies. However, while saving Cherry from a zombie, El Wray is fatally wounded. In the epilogue, Cherry, now sporting a minigun leg, leads the group and many more survivors to the Caribbean beach at Tulum, where they start a peaceful new society during a world-wide zombie outbreak. It is also revealed that Cherry has given birth to El Wray’s daughter (alluded to earlier during El Wray’s final scene when he puts his hand on her stomach and restates his motto “Two against the world”).
In a post-credits scene, Tony is sitting on the beach at the survivor’s “base” playing with his turtle, scorpion and tarantula.