Plot

Dehradun is a valley in North India and has various schools in the city. The Rajput school has students from affluent backgrounds with each student being an heir to a multi-million fortune. Some families have steel factories, others have tea estates. Rajput school excels in both sports and studies. In contrast, the Model school has students from poor local households. Other schools include Xaviers school and Queens school, the latter being an all-girls school with the guys from all three schools trying to woo them. The center of the town is called Mall Road and is the meeting place for everyone.

The highlight of the town is the annual inter-school sports championship with a 50-Kms marathon cycle race as the prime event. In the current year sports championship of 1990, Model and Rajput are almost neck and neck after several track and field events. The championship will be decided by the marathon cycle race. The race is contested between Ratan Lal Sharma (Mamik Singh) of Model school and Shekhar Malhotra (Deepak Tijori) of Rajput school with the latter winning the race because Ratan had an inferior bike. After the race both are felicitated by their respective schools. Shekhar being rich and now the local champion is cocky and arrogant. Shekhar is made the sports captain of Rajput school.

Ratan vows to compete again, and his father Ramlal, an ex-champion himself, promises to save up and buy him an expensive new cycle to match Shekhar's. A new foreign cycle will cost at least Rs 12,000 to 15,000. Ramlal was the first and only student from Model school to defeat Rajput in the cycle race in 1965. Ramlal gives money to Ratan to put away in the bank, which he passes to his younger brother, Sanjay.

Ramlal and his family run a small cafe which is the hangout spot for most of the school students. Ratan serves as a waiter at the cafe, while completing his studies. Shakoor Miyan (Ravindra Kapoor) is an employee at Ramlal's Cafe. Mr. Dubey (Asrani) is a teacher at Model school and doesn't think very highly of the school or its students.

Sanjay Lal Sharma (Aamir Khan) a.k.a. Sanju is Ratan's younger brother and is everything that Ratan is not. He's a carefree youngster who is full of himself and is always in trouble with his father Ramlal (Kulbhushan Kharbanda), who wants him to act more maturely and become responsible like Ratan. Ratan tells Sanju that he is looking for a short cut to success and adds that real success is only achieved through hard work and perseverance.

Sanju and his little gang, which includes Anjali (Ayesha Jhulka) (who has a crush on Sanju), Ghanshyam (Deven Bhojani), Maksood (Aditya Lakhia) & others bunk sports to smoke cigarettes and roam around town. Anjali and her dad Girdhari (Ahmed Khan) run a vehicle repair shop. Since Sanju and his friends have failed again, and are now in Anjali's class, Anjali's father asks his daughter to stay away from them.

A number of scuffles occur between Sanju and Shekhar because of Shekhar's attempts to humiliate Ratan and his dad. One time, Sanju engineers a fight between Shekhar and boys from Xavier's school, over a girl, and in the fight Ramlal's cafe furniture is destroyed. Ramlal and Ratan complain to the Rajput principal, but they get no compensation for damages and Shekhar is only given a light punishment.

Enter Devika (Pooja Bedi), who immediately catches the fancy of both Sanju and Shekhar. Initially she leans towards Shekhar but one day she misses her bus on the way to a picnic to meet Shekhar. Meanwhile Sanju asks Anjali for a car so that he can roam around town. Anjali steals a car from her father's garage for Sanju.

While on his way he spots Devika and leaves his friends at the Paan shop and gives Devika a lift. Devika upon reaching her destination finds Shekhar with another girl and goes along with Sanju who, although not rich, brags about his wealth. Sanjay gets expensive gifts for her from the money he is supposed to put away for Ratan's new cycle.

Sanju's lie is ultimately revealed when Devika sees him dancing in the Model school group during a dance competition. After the show, Sanju and Devika break up. In between, Sanju had quietly wasted money given to him by his father (he had saved it for Ratan's new cycle) on Devika. This leads to a heated argument between Sanju and his dad.

Next morning, Ramlal leaves for town and Ratan is out cycling. He stops to meet his girlfriend Kalpana when Shekhar and his friends pass by. A heated argument and fight ensue, Ratan is hit on the head by a stick and falls off the cliff. At the hospital, Ratan enters a coma but eventually awakens. Though he will recover, he is ruled out from competing in the next cycle race. While Ratan is in hospital, Sanju recollects his childhood with Ratan.

When his father returns, he reconciles with him. With Ratan in the hospital, Sanju becomes more responsible and decides that he will participate in the race and give it his best for Ratan. During his training, he realizes his true feelings for Anjali and the two embrace each other.

A day before the race, Sanju finds out about the real cause of the accident and confronts Ratan who tells him that he didn't say anything because Sanju had become responsible and closer to all of them. Ratan asks Sanju to give his best in the race if he wants to do something for him.

With his new cycle, Sanju participates in the race. The race begins evenly with both Sanju and Shekhar going head-to-head. Somewhere in the middle, the two fall and a scuffle ensues between Sanju and Shekhar. During this, other cyclists take the lead. Shekhar heads back on track with his friends holding Sanju back. Sanju breaks free and joins the race, catching up with Shekhar and finally beating him in the closing moments.

Model is overjoyed to celebrate their first victory in years. Ramlal is happy to see Sanjay come of age, while Ratan feels vindicated at Sanjay's victory over Shekhar.