Over the New York City skyline, Spider-Man is on patrol as thieves break into a bakery. Spider-Man easily takes them out and takes photos, then leaves them hanging up for the police along with a calling card. He then heads home to meet his curfew, pleased with himself.
At home, Dr. Curt Connors injects himself with lizard DNA to aid in the regrowth of his missing right arm. He's unaware the substance was modified by Electro's lightning bolts.
Peter arrives home to find Aunt May going over the bills, and he reassures her that things are about to change. However, when he develops the photos he discovers that he messed up the pictures. Meanwhile, Curt and his wife Martha look in on their son asleep, and discuss his interest in lizards. They go to bed where Curt tosses and turns and then feels pain in his stump. The limb regrows, much to the astonishment and pleasure of himself and his wife. However, once she finds out about the DNA she isn't thrilled at him experimenting on himself.
At school the next day, Flash and his gang spot Peter and prepare to hit him with water balloons. Peter senses them with his spider-sense and manages to avoid the first few. His gymnastics attract the crowd's attention and he lets himself get hit by the rest. Gwen finally intervenes, getting the crowd on her and Peter's side and embarrassing Flash.
Peter and Gwen go to the lab and Gwen refuses to let Peter give in. They clean up the lab with Brock until the Connors arrive to celebrate Curt getting his arm back. Martha notices something and gets their son out, then has him remove his shirt to reveal scales growing on his right arm and back. They determine that the reptilian part of his brain is growing and he's transforming further and further. Peter suggests they create a gene cleanser. Billy overhears them and Peter tries to get through to him, but Billy notes that lizards lay hundreds of eggs and then leave their children to be eaten by predators. Peter tries to reassure him but they're interrupted when Curt transforms into a humanoid lizard and goes berserk, breaking out of the lab.
Brock goes in pursuit and Peter tries to slip out, claiming he has to meet his curfew and disappointing Gwen. Once outside, Peter dons his Spider-Man costume and heads out into the subway after him. He manages to temporarily web up Connors who is unable to respond. The Lizard crawls along the subway ceiling and leaps onto a departing train. Spider-Man follows and they fight it out atop the train and then inside and underneath. Finally Spider-Man is knocked off and the Lizard makes his escape.
Martha and Gwen are in the laboratory and perfect the gene cleanser, but it has to be administered orally. Spider-Man returns to offer his help, while Brock reports the Lizard has gone to the Bronx Zoo. Spider-Man leaves with the antidote and Martha follows to be with her husband.
Spider-Man gets to the zoo and goes inside the lizard house, where the Lizard has taken refuge. He inadvertently mistakes a crocodile for the Lizard and ends up in a struggle with it, letting the Lizard grab him and drag him underwater. Spider-Man passes out but the Lizard is distracted when a crocodile attacks him. Brock rescues Spider-Man who comes up with a new plan: lure the Lizard into the neighboring polar bear pond. Brock goes to lure the Lizard in while Spider-Man webs off the bears in their caves then gets up above. Brock lures the Lizard in but Aunt May calls and the cell phone alerts the Lizard. He tosses Spider-Man around but Billy arrives and tries to get through to him. The Lizard considers him… and prepares to eat him. Spider-Man recovers enough to pull him into the polar pear pond. Using Billy's skateboard, Spider-Man props the Lizard's mouth open long enough to give him the antidote. Curt recovers just in time, losing his arm and passing out unconscious. Meanwhile, Peter gets all the photos published, and Brock and Gwen are angry Peter ran away just to take photos. Martha says that she can't trust him and fires him from his internship. Peter walks away, but not before secretly taking one dose of the antidote. At home he considers taking a dose to get rid of his powers and their problems, but decides to retain his powers so that he can help others. He hides the antidote in his room… for now.