Munich begins with a depiction of the events of the 1972 Munich Olympics and then cuts to the home of Prime Minister of Israel Golda Meir, where Avner Kaufman (Eric Bana), an Israeli-born Mossad agent of German-Jewish descent, is chosen to lead an assassination mission against 11 Palestinians allegedly involved in the massacre. To give the Israeli government plausible deniability and at the direction of his handler Ephraim (Geoffrey Rush), Avner resigns from Mossad and operates with no official ties to Israel. His team includes four Jewish volunteers from around the world: South African driver Steve (Daniel Craig), Belgian toy-maker and explosives expert Robert (Mathieu Kassovitz), former Israeli soldier and "cleaner" Carl (Ciarán Hinds), and a document forger named Hans (Hanns Zischler). They are given information by a shadowy French informant, Louis (Mathieu Amalric).
In Rome, the team shoots and kills Abdel Wael Zwaiter, who is broke and living as a poet. In Paris, they detonate a bomb in the home of Mahmoud Hamshari; in Cyprus, they bomb the hotel room of Hussein Al Bashir (Hussein Abd Al Chir). With Israel Defense Forces (IDF) commandos, they pursue three Palestinians to Beirut--Muhammad Youssef al-Najjar (Abu Youssef); Kamal Adwan; and Kamal Nasser, a Palestine Liberation Organization (PLO) spokesman--penetrating the Palestinians' guarded compound and killing all three.
Between hits, the often-reluctant assassins argue about the morality and logistics of their mission, expressing fear about their individual lack of experience, as well as ambivalence about implicating innocent bystanders. Avner makes a brief visit to his wife, who has given birth to their first baby. In Athens, he has a heartfelt conversation with a PLO member who is sharing the same safe house; he later sees this man killed during a hit on a target named Zaiad Muchasi.
The squad moves to London to track down Ali Hassan Salameh, who orchestrated the Munich Massacre, but their assassination attempt is interrupted by several drunken Americans. It is implied that these are agents of the CIA, which, according to Louis, protects and funds Salameh in exchange for his promise not to attack US diplomats. Meanwhile, attempts are made on the assassins themselves. Carl is killed by "Jeanette," an independent Dutch contract killer, whom the team pursues to the Netherlands, shooting her in revenge. Hans is found stabbed to death on a park bench, while Robert is killed by an explosion in his workshop. Avner and Steve finally locate Salameh in Spain, but again their assassination attempt is thwarted, this time by Salameh's armed guards.
A disillusioned Avner flies to Israel, where he is unhappy to be hailed as a hero by two young soldiers, and then to his new home in Brooklyn, where he suffers post-traumatic stress. He is thrown out of the Israeli consulate after storming in to demand that Mossad leave his wife and child alone. In the final scene, Ephraim comes to ask Avner to return to Israel and Mossad. Ephraim admits that there was no evidence directly linking any of the targets to the Munich massacre, and Avner decries the entire operation. A final intertitle notes that 9 of the 11 original targets were eventually assassinated, including Salameh in 1979.