In 2020, human boxers are replaced by robots. Charlie Kenton (Hugh Jackman), a former boxer, owns "Ambush", but loses it in a fight against a bull belonging to promoter and carnival owner Ricky (Kevin Durand), who rigged the fight to mess with Charlie as he sees him as a joke, partially because he beat him up the last time they competed for bailing on the bet. Having made a bet that Ambush would win as a result, Charlie now has a debt to Ricky that he can't pay—which he runs out on.
After the fight, Charlie learns that his ex-girlfriend died and he must attend a hearing deciding the future of their son, Max Kenton (Dakota Goyo), whom Charlie has had almost zero contact with and complete apathy towards since he was born. There, Max's aunt, Debra (Hope Davis), and her wealthy husband, Marvin (James Rebhorn), request full custody, which Charlie concedes for $100,000, half in advance, on the condition that Charlie retains Max for three months while they are on vacation and the other half when they return. Thereupon, Charlie, Max, and Bailey Tallet (Evangeline Lilly), the daughter of Charlie's former boxing coach, acquire the once-famous "Noisy Boy", but it is destroyed in a subsequent fight against "Midas". As he and Charlie attempt to scavenge parts to make a new robot from a junkyard, Max discovers "Atom", an obsolete but intact sparring robot designed to withstand severe damage, that is capable of mirroring opponent and handler movements and storing them in its memory due to its rare "shadow function".
At Max's behest, Charlie pits Atom against "Metro", whom Atom overcomes. Max programs Noisy Boy's vocal-respond controls in Atom, and convinces Charlie to help him with Atom's fighting move memory, resulting in a series of victories and culminating to being offered a fight in World Robot Boxing against national champion "Twin Cities". After reaching the arena, the owner of global champion "Zeus" offers to buy Atom, which Max instantly rejects. Charlie disagrees, but eventually takes Max's side. The fight starts with Atom on the attack, but Twin Cities easily takes the offensive and corners Atom. While their opponent has no blind spot, Charlie notices a hitch whenever Twin Cities throws a right jab. Using this, Charlie is able to get Atom out of the corner and eventually win by knockout. Elated by their success, Max challenges Zeus, publicly, with the audience squarely on their side. After the fight, Ricky and his two henchmen ambush Charlie for bailing earlier and rob them of their winnings, prompting Charlie to return Max to Debra.
This upsets Max, and when Charlie tries to convince him that living without him is better for Max, Max says he always wanted Charlie to fight for him and be there as a father. After Max leaves, Charlie returns to Bailey. While talking with her about the events, the two kiss, revealing their attraction to each other. Persuaded by Bailey, Charlie arranges the challenge offered by Max and convinces Debra to allow Max to witness the fight.
Zeus starts the fight by knocking Atom down with its first punch, but Atom gets up, and Zeus continues its assault, knocking Atom down multiple times, but each time Atom gets back up, and eventually is able to land its first punch, a right uppercut. Atom survives the first round, stunning the audience. Ricky, who had made a bet with a friend of Charlie's of $100,000 that Atom would not last the round, tries to slip away, but is cornered by the fight's bookmakers. The two opponents go back and forth through the fight, Atom landing multiple punches but also getting knocked down many times, getting back up for each of them. Late in the fourth round, Atom's vocal-respond controls are damaged, forcing Charlie to use its "shadow function" to make it mimic his boxing skills. This, and the fact that Zeus starts running out of power from its constant offense, tip the odds in Atom's favor, forcing Zeus' programmer to manually control it. As Zeus gets a sound beating, once even hitting the ground and barely avoiding losing by knockout, Max and Bailey both watch Charlie doing what he was meant to do, and are touched by seeing him literally fighting for his son. Despite the continued beating, Zeus manages to survive the final round and wins the match by the decision of the judges. Although Zeus remains undefeated, Atom is hailed as the "People's Champion" for fighting the technologically superior machine to a near-draw.
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