One night, Shrek, a large ogre who lives in a cozy cottage in a swamp, has his solitude interrupted by torch-carrying villagers from a nearby town. After Shrek politely frightens the villagers away, he picks up a dropped piece of paper that reads: “Wanted Fairy Tale Creatures Reward.” The next day, as dozens of terrified fairy tale creatures are being brought in for rewards, an Old Woman turns in a Donkey, saying that he talks. Donkey refuses to speak, but when a tiny fairy crashes into him, sprinkling him with magic dust, he starts to fly and gleefully boasts out loud. Crashing to earth, Donkey escapes and runs into Shrek. They are soon approached by guards, who order them to halt by order of Lord Farquaad, but Shrek scares them away. The jive-talking Donkey, who immediately warms to his new acquaintance, decides to tag along with Shrek, despite the ogre’s gruff insistence that he likes to be alone. Back at the swamp, Shrek refuses to allow Donkey to stay inside his cottage, but soon finds his dinner interrupted by the appearance of three Blind Mice, a nightgown-clad wolf and a myriad of other fairy tale creatures. Shrek loudly orders them to leave his swamp and return home, but they reply that they cannot because Farquaad has evicted them. The disgusted Shrek determines to remedy the situation by finding Farquaad and demanding that the creatures be sent back. Amid the gleeful cheers of the creatures, Shrek, accompanied by the unshakable Donkey, sets off to find Farquaad. Meanwhile, in a castle in Duloc, the diminutive Farquaad tortures a Gingerbread Man, then asks a Magic Mirror how he can become king. Magic Mirror advises him to marry a princess and shows him three choices, Snow White, Cinderella and, finally, Princess Fiona, who is locked in a castle guarded by a Dragon. Farquaad does not listen to Magic Mirror's warning that something happens to the beautiful Fiona at night and chooses her, then determines to find a champion to free her. When Shrek and Donkey arrive at the immaculately maintained Duloc, the town is deserted, but they find everyone in the stadium listening to a speech by Farquaad, who is holding a tournament to determine a champion. Seeing Shrek, Farquaad announces that the person who kills the ogre will be the champion. Shrek easily bests his attackers and so impresses Farquaad that he names Shrek his champion and agrees to give him the deed to the swamp and send the fairy tale creatures back home in exchange for freeing Princess Fiona. As Shrek and Donkey journey toward the princess’ castle, Shrek philosophizes that ogres are usually misunderstood but actually have many layers, like onions. Once at their destination, Shrek and the frightened Donkey successfully navigate a rope bridge suspended over a lava pit and enter the castle. Donkey comes face to face with the Dragon, who snaps to attention and goes after him, but Shrek dons armor and saves him. In the process, though, Shrek is flung into Fiona’s tower room. She is impressed by Shrek’s entrance and pretends to be asleep so that her “knight so bold as to rescue her” can kiss her awake. Instead, Shrek gives her a shake and is uninterested in her talk of romance. Dragging Fiona through the castle, Shrek finds Donkey, who has inadvertently awakened amorous feelings in the female Dragon. She tries to prevent them from leaving, but Shrek effects their escape and ensnares the Dragon in chains. Once safely on the road to Duloc, Fiona demands to see Shrek’s face and is disappointed by his appearance until he assures her that Farquaad has sent him. When she stubbornly insists that only her true love can rescue her, Shrek hoists her over his shoulder and continues on. During the journey, Donkey seeks Fiona’s advice on how to discourage the Dragon’s romantic interest, and Shrek and Donkey joke about Farquaad’s size. When Fiona realizes that it will soon be nightfall and Duloc is some distance away, she adamantly refuses to go farther and spends the night alone in a cave. Later, as Donkey sympathizes with Shrek’s regret that the world “has a problem” with a big ugly ogre, Fiona eavesdrops. Next morning, a very cheerful Fiona emerges from the cave and makes breakfast for Shrek. When the three resume their journey, Fiona and Shrek playfully tease each other and start to realize that they have a lot in common. When they see Duloc in the distance, both Fiona and Shrek come up with excuses to delay reaching Duloc. During dinner, Shrek and Fiona look dreamy-eyed at each other, but at sunset Fiona retreats, alone, into a deserted windmill. Donkey comments that Shrek and Fiona are “digging on each other,” but Shrek thinks that a princess would never be interested in an ogre. Donkey then sneaks into the windmill and is astonished to find that Fiona has turned into an ogre. She tells him that because of a curse she will spend her days beautiful, but at sunset turn into the ugly creature she is now, until the curse is removed by love’s first kiss. She then starts to cry, saying that she must marry Farquaad before sunset. Just as Fiona expresses doubt that anyone could love someone so ugly, Shrek, who has gathered flowers and practiced loving endearments to tell Fiona, approaches the door of the windmill and thinks that she is speaking of him. The next morning, Shrek angrily tells Fiona he heard what she said the previous night, and she assumes that he knows about the curse but does not care for her because she is ugly. Just then, Farquaad and his entourage arrive, and he proposes to Fiona, who immediately accepts and suggests that they marry that day. After Fiona rides off with Farquaad, Shrek angrily rejects Donkey’s advice and the two part. During the ensuing hours, Fiona pines for Shrek as she prepares for her wedding, while Shrek sadly returns to his lonely swamp and Donkey encounters the lovesick Dragon, who has followed him. Later, Shrek hears something outside and finds Donkey building a wall with some branches. Donkey chastises Shrek for building his own walls and for pushing away Fiona, who likes—and may even love him. Shrek then apologizes to Donkey, who forgives him because "that is what friends are for," and the two determine to stop Fiona’s marriage to Farquaad. With the aid of the happily smitten Dragon, Shrek and Donkey arrive at the Duloc cathedral just as Fiona and Farquaad are pronounced man and wife. Shrek rushes up the aisle and tells Fiona he wants to talk with her, incurring Farquaad’s contempt for being an ogre in love with a princess. Just then the sun begins to set and Fiona turns into her ogre self. When Shrek tells her he loves her, she admits that she loves him, too, and they kiss, apparently breaking the curse. Fiona does not understand why she has not transformed into her beautiful self, but Shrek assures her she is beautiful. Some time later, in the swamp, Fiona and Shrek marry, with all of their fairy tale creatures in attendance, then ride off on their honeymoon in an onion magically transformed into a coach.