Ash Ketchum, Brock and Dawn are at a Pokémon Center watching a Pokémon Baccer match on TV. Ash and crew are intrigued by the match and decide to head to Crown City to watch the Pokémon Baccer World Cup.
Meanwhile, businessman Grings Kodai, his henchman Goone and assistant Rowena are in Unova where they find Zoroark and a sleeping Zorua. They capture the two Pokémon and take off for Crown City. Zorua, who is trapped on Kodai's plane, manages to escape and disguises itself as a Skiploom, and drifts down to the ground unnoticed.
Meanwhile, the protagonists are on their way to the Pokémon Baccer World Cup in Crown City, and encounter and rescue the Zorua from a group of Vigoroth. Zorua is able to speak to humans through telepathy. Zorua wishes to go to Crown City to find its mother Zoroark who it refers to as "Meema". Zorua's shapeshifting skills are compromised by the constant presence of its tail; touching it reverts Zorua to normal. The next day, Celebi appears in town and causes all the flowers to bloom, much to the delight of several townsfolk, who recall a mysterious event that happened twenty years where all the city's flora died.
Meanwhile, Kodai unleashes the imprisoned Zoroark upon the city, pretending to hold Zorua prisoner. Zoroark uses her illusion powers to take the form of Raikou, Enteiand Suicune and scare the townsfolk; Kodai edits recorded footage of her to make it look like the fake Pokémon are on the rampage and labels Zoroark as evil.
Ash, Dawn, Brock and Zorua arrive, seeing Zoroark on television, Zorua trying to reach the cut-off town. They meet Karl, a local journalist investigating Kodai, who leads them into town through a hidden passage in a windmill. Kodai is revealed to be able to see into the future, caused by an encounter with Celebi twenty years ago where he touched the Time Ripple, created when Celebi time travels, gaining his powers of foresight, causing the destruction of the town’s plant life in the process. Kodai is looking for the Time Ripple again, and has Goone recapture Zoroark, having a vision that Ash, Dawn, Brock, Karl and an unknown woman will stop him.
The group meet Karl’s grandfather Joe and his friend Tammy, who explain Celebi used to visit the town before the plant life died. Zorua runs off on its own to find Zoroark, finding the other Pokémon are hostile towards it, but Celebi appears and befriends Zorua, Pikachu and Piplup. Ash and co. are captured by Kodai, but Rowena releases them, revealed to actually be Karl’s fellow journalist working undercover to find out Kodai’s plan.
Rowena explains Kodai’s past, and how the Time Ripple will linger for a day after Celebi time travels, Kodai planning to absorb its power again to replenish his fading foresight. Kodai has a vision that Celebi will show him the Time Ripple, and he targets it and Zorua. Zoroark escapes her prison, just as the real Legendary Beasts arrive in town and engage Zoroark in a fight. Kodai harms Celebi, seeing more of the future. Ash and co. arrive, Kodai realizing Rowena is the woman in his vision. The group flee with Zorua and Celebi, meeting up with Joe and Tammy, where it is revealed the location of the Time Ripple is in the local stadium, Kodai eavesdrops on the conversation and races for the stadium. While Karl, Rowena, Joe, and Tammy stop the fighting between Zoroark and the Legendary Beasts, Ash, Dawn, Brock, Pikachu, Zorua and Celebi head for the stadium.
Dawn and Brock fight Goone and his Pokémon, later assisted by Zoroark, who then joins Ash, Pikachu, and the injured Celebi at the stadium. Kodai takes Zorua captive and threatens to kill it unless the heroes back off, before absorbing part of the Time Ripple and replenishing his power, confessing that he has fooled the townsfolk twice with his media manipulations. However, Zoroark soon reveals Kodai's victory to be nothing more than an illusion she created, as Kodai's illusion canceller was destroyed when Zorua bit his wrist. Kodai attempts to kill Zoroark for her trickery using his electrical grappler claw, but she destroys it with her Dark Pulse attack when she uses some of her remaining strength to fight the grappler claw's electricity. Kodai tries to reach the Time Ripple but is blocked by the legendary beasts, and Zoroark traps him in the stadium using her illusions.
Zoroark collapses from exhaustion, but Celebi ventures into the Time Ripple to rejuvenate its own power and revives Zoroark, before departing back to the future. Kodai's confessions are played on television, and he is promptly arrested, with Zoroark's roar announcing Kodai's defeat. At the end of the film, Zorua and Zoroark depart back to their homeland, the Unova region, with Karl and Rowena for company. Ash vows to Zorua that he and Pikachu will reunite with it when they visit Unova some day.
- Diesel 10, Splatter and Dodge will work for Kodai in this film.
- The reason why this is the last film in the Little Bear/Pokémon franchise, is because Pokémon: Zoroark - Master of Illusions marks the last appearance of Brock. And he has never appeared in another Pokémon film ever since.
- After this adventure, Little Bear tells Ash that he'll become a Pokémon trainer and promises he'll one day battle him.