Two rival teenage gangs struggle for control of their neighborhood on the Upper West Side of Manhattan.

When they encounter members of a Puerto Rican street gang called the Sharks, the Jets, a local white gang, decide to challenge the Sharks to a rumble for undisputed control of the neighborhood.

Detective Schrank, the senior cop on the beat, tries to get the Jets to tell him which Puerto Ricans are starting trouble in the neighborhood, as he claims he is on their side. The Jets, however, are not stool pigeons and won't tell him anything. Frustrated, Schrank threatens to beat the crap out of the Jets unless they make nice.

Action wants to be his second, but Riff says Tony is always his second. The other Jets complain that Tony hasn't been around for a month, but Riff doesn't care. Once you're a Jet, you're a Jet for life. ("Jet Song").

Riff visits Tony, who is now working at Doc's drugstore, and tries to persuade him to come to the neighborhood dance for the war council. Initially, Tony refuses. Being a Jet doesn't give him the same thrill it used to. He feels like something big is just around the corner. But Riff is still his pal and wins him over in the end.

Maria is attending the dance with Chino, whom she is expected to marry despite the fact that she doesn't have any feelings for him.

At the gym, the Jets and their girls dance on one side, while the Sharks and their girls dance on the other. Glad Hand, the chaperone who is overseeing the dance, makes an unsuccessful attempt to get the kids to dance together, across gang lines.

While the rival gangs have a dance off, Maria and Tony spot each other. Forgetting the tension in the room, they dance together, and there is an instant connection. Bernardo interrupts them, telling Tony to stay away from his sister and asking Chino to take her home.

After Tony finds Maria's building and serenades her outside her bedroom window, she joins him on the fire escape, and the two young lovers profess their love to each other ("Tonight").

Tony suggests "a fair fight"--fists only, no weapons. Both leaders agree, despite protests from some members. Bernardo thinks that he will fight Tony, but Riff chooses Diesel to represent the Jets.