Adapted from Thomas Keneally's account of a Czech businessman and Nazi Party member who tried to make his fortune during the Second World War by exploiting cheap Jewish labour but ended up risking his life and becoming bankrupt in order to save more than a thousand Jewish Poles from the Holocaust.

Oskar Schindler arrives in Krakow (Poland) not long after Germany invades the country. The Nazis' relocation of Jewish citizens has already begun, but their ultimate objective is not yet fully understood by most civilians. Schindler acquires a factory for the production of army mess kits but, with no previous experience of running such an enterprise, he gains the support of Itzhak Stern, a functionary in the local Judenrat (Jewish council) who also has contacts with the underground Jewish business community in the ghetto. They lend him the money for the factory in return for a small share of its products, for trade on the black market. At Stern's suggestion, Schindler hires Jewish Polish workers instead of Catholic Polish workers because they cost nothing: Jewish workers receive nothing because their wages go to the Reich.

When Amon Göth arrives in Krakow to initiate construction of Paszów labour camp nearby, the SS clears Krakow Ghetto, sending in hundreds of troops to empty the cramped rooms and shoot anyone who protests or is uncooperative, elderly, or infirm. Schindler watches the massacre from the hills overlooking the area, and is profoundly affected. He is nevertheless careful to befriend Göth and, with Stern's advice, turns to bribing Göth and other key officials in order to continue enjoying the SS's support and protection. The commandant is a vicious and sadistic man who enjoys shooting Jewish people as target practice from the balcony of his villa overlooking the prison camp he commands.

Schindler gets Göth to agree to build a sub-camp at Paszów for Schindler's workers. The initial motive is to keep his workers safe from the depredations of the guards. When an order arrives from Berlin commanding Göth to exhume and destroy all bodies from the Krakow Ghetto massacre, dismantle Paszów, and ship the remaining Jewish prisoners to Auschwitz, Schindler prevails upon Göth to let him keep 'his' workers. With the Final Solution now fully underway in occupied Poland, Schindler and Stern assemble a list of workers that should keep them off the trains to Auschwitz.