The protagonist of the movie is born with a divine grace of Lord Shiva (Prakash Raj) and the boy’s parents are advised to name him as Mallikarjuna as he is destined to accomplish a great work. During his childhood, Mallikarjuna faces a great tragedy as his parents and grandparents are killed by a huge feline creature when they are returning from Kashi. This incident leaves his younger sister, Sailu (Abhinaya) paralyzed from the waist and hence renders her lame (Sailu had a talent for dancing before this incident). This disaster makes Malli to become an atheist.
Meanwhile, the scene shifts to the focus of a demon named Andhakaasura (Ravi Shankar). We see him performing a severe penance to obtain the boon of Lord Shiva. Lord Shiva blesses the demon that he will not interfere in the latter’s attempt to sacrifice a virgin girl in order to obtain complete rulership over the 3 worlds. The demon is advised by his aged friend Maayi (Jeeva) that the sacrifice must be made in a month having 2 solar eclipses, in such a way that he has to marry the girl and sacrifice her before the solar eclipse ends. This will render the demon matchless and a master over all the 5 elements.
The story then shifts to Malli (Nagarjuna), now an adult whose motive is to help people and take care of his bedridden sister. He falls in love with Dr. Maheshwari (Anushka Shetty) on a visit to the hospital where his sister is being treated. There are many scenes where the atheist Malli forces the people of his colony who include Rudraksha (Brahmanandam), Ringu Raja (Raghu Babu), President (Krishna Bhagavaan) and others, not to worship, on account of his childhood tragedy. Then, on one occasion, Malli questions Lord Shiva for his condition and drives away in his car, only to meet with an accident. Lord Shiva comes and saves him. Lord Shiva calls himself as Saambayya, befriends Malli and goes to his home.
The demon chooses Dr. Maheshwari as his target for the sacrifice and prevents the Kaapaalikas (who arrive to the temple) from having access to Mahi, on the first solar eclipse day. Malli rescues Mahi from the Kaapaalikas and Mahi’s parents entrust Malli to take care of Mahi. Then, Mahi’s parents decide to get Mahi married to a relative, Rahul (Ganesh Venkatraman), who is to arrive from US. This advice is given by saint known to Mahi’s family. On his arrival to the airport, Andhakaasura kills Rahul in the washroom and takes his form. The demon, now in Rahul’s form, enters Mahi’s home, and kills 3 dogs who guard Mahi. The demon also paralyzes Mahi’s father, when he comes to know the truth about him. He also tires to kill Malli and Mahi, on their way to a temple, but Lord Shiva intervenes by sending his divine vehicle, Nandi who saves Malli. This infuriates the demon, who feels that Lord Shiva has not kept his promise. He challenges the Lord, to which he replies that it was his duty to protect his devotee. The demon then decides to oppose Lord Shiva, so he kills the saint known to Mahi’s family, impersonates him and convinces Malli, Mahi and others that Saambayya is not a good person by faking his death at the hands to Saambayya. This makes Malli angry on Saambayya and he returns the ring of friendship given to him by Saambayya.
Finally, Malli convinces Mahi’s family that Rahul is actually Andhakaasura. Then, the demon carries Mahi to the spot of sacrifice and prepares for the ritual. Meanwhile, Malli is advised by the Kaapalika chief (Avinash) to worship Lord Shiva, he tells Malli about his purpose of birth to destroy the demon and the means to do it, as he was the reason of the tragedy in Malli’s Childhood and Lord Shiva saved him as Saambayya. Malli confronts the demon, is initially defeated, but he heads skyward to get a blessing from Lord Shiva and finally destroys Andhakaasura by piercing the Trident given by Lord Shiva.