When the famous Pink Panther diamond is stolen once again from Lugash, Chief Inspector Clouseau (Peter Sellers) is called on the case despite protests by Chief Inspector Dreyfus (Herbert Lom). While on the case, Clouseau is followed by the mob who are seeking to assassinate him. Meanwhile, Dreyfus learns from Scotland Yard that Libyan terrorists may have marked Clouseau for assassination once he announces his intent to visit the scene of the crime in Lugash. Rather than order him back to Paris, Dreyfus orders him to continue on to Lugash as planned.