Beat Street is set in the South Bronx, the film follows the lives of a pair of brothers and their group of friends, all of whom are devoted to various elements of early hip hop culture. Kenny Kirkland (Guy Davis) is a budding disc jockey and MC, and his younger brother Lee (Robert Taylor) is a hardcore b-boy who dances with Beat Street Breakers (theNew York City Breakers). Kenny’s best friends are Ramon (Jon Chardiet), a graffiti artist known by his tag, “Ramo”, and Chollie (Leon W. Grant), his self-styled manager/promoter.
The film begins with the main characters preparing for a house party set in an abandoned apartment building, where Kenny is the featured DJ. An uninvited Lee and his breakdancing friends crash the party, and nearly get tangled into a battle with a rival troupe, the Bronx Rockers (the Rock Steady Crew). The battle of mostly words is broken up by Henri (Dean Elliot), a squatter who lives in the building and is befriended by Kenny, Chollie, Ramon, and Luis (Franc. Reyes).
Kenny has dreams of performing in New York City’s top nightclubs. No club is bigger than the Roxy, and on one visit he crosses paths with Tracy Carlson (Rae Dawn Chong), a college music student and composer. Abreakdance battle between the Breakers and Rock Steady ensues, and Tracy admires Lee’s performance. She then invites him to audition for a television show focusing on dancing. Lee, Kenny, and their crew arrive during a dance rehearsal, and Lee gives his performance only to find out he won’t be on television. Protecting his brother’s interests, Kenny rips into Tracy for leading Lee on; Ramon steals a videotape of Lee’s dance as the crew walk out.
A remorseful Tracy then shows up at the Kirkland home to apologize. Lee was not home but Kenny was, working on a mix tape. Tracy clarifies her story, saying that she did not promise to Lee that he was going to be on the TV show. She then takes an interest in Kenny’s mixing and the two find common ground. Kenny and Tracy then head into the subway, where they meet up with Lee, Ramon, and Luis spray painting an abandoned station platform. They pack up and leave when they hear noises, thinking it may be the police; it turned out to be a rogue graffiti artist known as Spit who defaces Ramo’s work (and the work of other artists) by spraying his tag over it. As the group take the train back uptown, Kenny and Tracy break away and spend the rest of the evening together, striking up a romance while walking and talking.
Chollie talks Kenny into a guest spot at the Burning Spear, a club run by DJ Kool Herc. Kenny not only spins but presents a special Christmas-themed skit performed by the Treacherous Three, Doug E. Fresh, and the Magnificent Force. The crowd’s positive reaction convinces Kool Herc to invite Kenny back. But both Kenny and Chollie see the regular gig as a stepping stone to their bigger goal. They return to the Roxy, where auditions are being held for new talent. Chollie convinces Kenny to let him do the talking, and waits for the auditions to end before he succeeds in getting the talent scout to check out Kenny at the Burning Spear.
The scout keeps his word, and is impressed enough that he offers Kenny a performance on New Year’s Eve. Tracy offers to help Kenny out by allowing him to work on a computer keyboard system at her studio. However, Kenny accidentally presses a wrong button and deletes his work. Stubborn and frustrated, Kenny leaves the studio, saying he had enough material for New Year’s Eve.
Meanwhile, Ramon is feeling pressure from two sources. His father Domingo (Shawn Elliot), who despises his graffiti, wants him to find honest work, while his girlfriend Carmen (Saundra Santiago), the mother of his son, longs for them to be together as a family. Ramon eventually gets a job in a hardware store, and he then takes Carmen and their baby to live with him in Henri’s building. But Ramon does not stop thinking of the subway trains that are his canvas. When he sees a white-painted one pass him by, he vows to put his mark on it.
Later that evening, Ramon and Kenny find the train and proceed to paint one side of the lead car. As they work on the second side of the car, Ramon hears noises, and they discover the rogue graffiti artist Spit, defacing the completed side. Ramon and Kenny chase Spit through the tunnel and into a station, and a fight ensues. Spit sprays paint in Ramon’s eye, and both men tussle on the roadbed before they roll onto the electrified third rail, which kills them instantly.
As the group mourn the death of their friend, Kenny considers not performing for the New Year’s Eve show at the Roxy. However, with the help of Tracy and despite initial reluctance from Chollie, Kenny turns his big break into a celebration of Ramon’s life. The show is the film’s grand finale, starting with a rap performance by Kenny while images of Ramon and his work were shown on a screen in the background. Kenny is followed by Grandmaster Melle Mel & the Furious Five and a Bronx gospel choir, and backed by dancers and breakdancers.