In Brazil, various exotic birds are smuggled out of the country. In Moose Lake, Minnesota, a crate with a male Spix's macaw hatchling falls out of a truck and is found by a little girl named Linda Gunderson, who names him Blu. Over the next 15 years,<ref name="TeleRhap" /> Linda comes to own a bookstore. Highly domesticated and unable to fly because he is scared to, Blu is ridiculed frequently by the Canada goose that come by outside of Linda's bookstore.
Spix's Macaws Blu and Jewel and their three children—Bia, Carla, and Tiago—are living happily Rio de Janeiro until Jewel realizes that her children are becoming more like humans. Meanwhile, Blu's former owner, Linda Gunderson and her Ornithology husband, Tulio are on an expedition in the Amazon rainforest and, after a fall down a waterfall, discover a quick-flying Spix's macaw that loses one of its feathers. When word gets out about this through television, Jewel believes that they should go to the Amazon to help find the blue macaws. While the kids are ecstatic, Blu is uncertain, but he is pressured into going along. Rafael, Nico and Pedro decide to come along. Luiz attempts to follow but fails. Blu brings a fanny pack full of supplies, one of which he uses mostly is a Global Positioning System, much to Jewel's displeasure.