'Mela' is a dramatic tale that revolves around the life of a beautiful young woman on the verge of getting married, Roopa, who lives in a small town called Belapur with her two brothers, Gopal and Ram, an officer in the Indian army, and her widowed mother.
Ram returns to Chandanpur to arrange her marriage. A Minister from the ruling party comes to visit their town, and the Sarpanch, Mukhiya Murari, decides to organize a mela (fair) in his honor. The Minister arrives to the sound of dancers, trumpets and music, but the festivities are cut short when terrorists attack the town, killing and injuring many.
To make matters worse, Roopa's beauty catches the eye of Gujjar. However, as Gujjar attempts to accost the terrified Roopa, her brother comes to her rescue, only to be slain, much to the shock of the entire village. Gopal (Master Om Kapoor) who also rushes to rescue Roopa, is killed too, much to the horror of Gopal's mother (Tanvi Azmi). Roopa, enraged by the fact that Ram and Gopal are no more, vows to avenge their deaths.
Gujjar openly announces that Roopa will have no other identity than as his mistress and will never be able to have a brother nor lover. Enraged, Roopa attempts to commit suicide by jumping into a waterfall but destiny has other plans. Roopa survives and is left with no other option to clothe herself than steal those of Kishan (Aamir Khan), a theatre actor.
Kishan works with his best friend, truck driver, Shankar (Faisal Khan). When Kishan meets Roopa for the first time, he is smitten by her beauty and falls in love with her. Kishan decides to make Roopa the heroine of their dance show, despite Shankar's predictions that Roopa will bring them only trouble. With no option, Roopa travels with them, and pretends to be an ordinary runaway until she finally tries to escape, but returns when chased by the gang and a drunk who tries to rape her.
Roopa feigns love for Kishan, who wholeheartedly wants to marry her, and the two men agree to help her return to Chandanpur. Just prior to the wedding guilt forces Roopa to finally confess her real identity, while predictably, Kishan becomes distraught and enraged by her deception. Shankar however, empathizes with Roopa and accompanies her to her village, while Kishan, heartbroken, leaves in disgust.
In Chandanpur, Shankar mobilizes the village and another carnival is arranged to set up a trap for Gujjar, the terrorist. When Gujjar finds out that Roopa is back, he gathers his men and they storm the town, and encounter some resistance - which they soon overcome.
Kishan returns to profess his love for Roopa only to find out that she has been kidnapped. The friends give chase and are captured and at Gujjar's mercy; it looks like history is going to repeat itself all over again - and this time Gujjar will make sure that nothing goes wrong.
Eventually the forces of good heroically prevail and the outlaws meet an ignominious end. Roopa is united with her brother Shankar and her lover Kishan. At the end Kishan and Roopa get married and the whole village celebrates.