Ominous music plays as a car emerges out of steam into a dark and threatening urban landscape. The camera flashes on Travis Bickle's eyes, which appear menacing. The first scene after the credits introduces us to Travis as he interviews for a job as a taxi driver. He tells the interviewer that he is twenty-six years old, was honorably discharged from the Marines in 1973 (indicating to viewers that he served in the Vietnam War), and that he can't sleep at night. The interviewer reveals that he had been a Marine as well and tells Travis to come back for work the next day. Travis leaves and begins drinking from a flask in broad daylight.
As Travis's job as a taxi driver begins, so does his diary, which we hear as a voiceover. Travis complains about how dirty New York is and talks about how he does not discriminate against his passengers. We see him driving around on a typical day. When he gets off work in the morning after driving for twelve hours at night, he immediately begins drinking and attends a porn film. At the entrance he tries to be friendly with the concession lady, a young black woman. She quickly rejects his efforts to reach out, so he spends his morning alone in the porn theater. Travis complains about his inability to sleep, even after working all night, and talks about wanting to become more normal. He wishes to have someplace to go and to fit in with other people. Travis hangs out with other cabbies sometimes at an all-night diner. He is clearly made uncomfortable by Charlie T, a black cab driver, and by the other black people in the diner.
One day while driving his cab, Travis sees Betsy, a beautiful blond woman in a white dress. To Travis, she stands out from the rest of the people in the crowded, dirty city. Betsy works at the Palantine presidential campaign headquarters in New York. We see Betsy talking to her coworker, Tom, who also seems to be in love with Betsy, while Travis watches from his cab outside.
Travis finally gathers the courage to ask Betsy out. He dresses up and walks into the campaign headquarters, introduces himself, and asks Betsy out for coffee. Charmed and intrigued, Betsy agrees. Travis and Betsy's date at the diner goes well, and she agrees to go to a movie with him.
Later, coincidentally, Travis gives Palantine, the candidate, a ride in the cab. Travis flatters Palantine, saying he's Palantine's biggest supporter, but when Palantine pushes Travis to talk about an issue, Travis speaks inappropriately, saying that he just wants to see the city rid of all its scum. Travis's next fare is a young prostitute, Iris, who jumps in the cab and tells it to take off. While Travis hesitates, a man pulls the girl out of the cab and throws Travis a twenty-dollar bill, telling him to forget the incident. Travis seems unable to get the girl out of his mind, and he puts the bill in a place separate from the rest of his money.
Travis takes Betsy to a porn film in Times Square. When Betsy realizes what the film is, she becomes disgusted and leaves. After this night, she refuses to take his calls and returns the flowers he sends her. Travis becomes angry and eventually storms into the Palantine office to confront Betsy in public, but there he is humiliated.
The next scene shows Travis, back in his cab, pulling over to let a man out. But the unnamed passenger wants to stay in the cab to watch the silhouette of a woman in a window above. The passenger claims the woman is his wife and that she is sleeping with a black man. He goes on hysterically about shooting his wife with a .44 Magnum. Later, at the diner where the cabbies hang out, Travis pulls Wizard aside and tries to reach out to him, saying he's been feeling down and having bad ideas in his head. The only thing Wizard can tell him is that he is stuck as a taxi driver, that the job will become him. Travis seems to be losing his mind more and more. One day he absentmindedly runs his cab into a young prostitute, the same one who jumped into his cab before.
Travis buys four guns from an underground dealer, saying that he is going to change his life. He wants to turn over a new leaf—to eat and drink more healthily, and to train his body. We see him doing push-ups and holding his fist out over an open flame, as if he is training for combat. Travis begins to stalk Palantine. He goes to his rallies and watches him on television. He arouses suspicion by talking to a Secret Service agent at one of the rallies. Travis's speech becomes more disjointed and repetitive, especially when he is alone. He practices pulling out his gun in the mirror, saying "You talkin' to me?" One night he stops at a convenience store. When a young black man comes in and tries to stick up the store, Travis shoots and kills him. The shooting has no consequences for Travis because the convenience store owner just thanks him and then starts beating the dead man. Travis continues to stalk Palantine, and he writes a letter to his parents. They know nothing about where their son is or what he does.
Travis finally searches for Iris, the young prostitute he has seen twice before. He tries to pay Sport, her pimp, for time with her. Iris tries to seduce Travis, but he refuses to have sex with her. Instead, he asks her why she doesn't leave her job. He has coffee with her the next day and again tries to convince her to leave Sport. She says she'll think about it, and that she dreams of going to a commune in Vermont. She asks Travis to go with her, but he says he has more important plans. Iris goes back to Sport to tell him she's unhappy, but Sport is seductive and romantic and convinces Iris to stay.
On the final day of the film's action Travis prepares to leave the house. First, he burns all the flowers he bought for Betsy, and then he writes a note for Iris, enclosing $500 so she can go to Vermont. He writes that by the time she reads the letter, he will be dead. He goes to a Palantine rally with his hair shaved into a Mohawk. His intention to assassinate Palantine becomes clear. Soon, though, Secret Service agents spot him and pursue him. Since his plan has failed, he goes instead to Iris's building. There, in a long, bloody shoot-out, he kills Sport, the man who rents out Iris's rooms, and a man who was about to visit Iris. When Travis tries to shoot himself, he realizes that he has run out of bullets. As the police rush in, he puts his hand to his head and pretends to shoot himself.
The film moves forward by a few months. Travis has become a hero of sorts for saving Iris. We hear Iris's father reading a letter he has written Travis, thanking him for sending Iris home. The camera pans across all the newspaper articles that label Travis a hero. In the final scene, which is most likely a fantasy, we see Travis standing around with his cabbie friends when Betsy gets into his cab. She is clearly impressed by Travis's recent success and says she'll see him around. Travis never looks back at her but stares at her reflection in his rearview mirror.
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