The movie opens with the Adventure-aged Taichi remembering a battle between a Parrotmon and Greymon, which occurred several years ago. Then, the title screen appears, and the movie, which is presumably the complete flashback, continues.
Above Hikarigaoka, a large amount of 0s and 1s converge in the sky, disrupting electronics, including the computer screen a young Hikari is looking at. Taichi gets up and uses the bathroom, and on his way back he finds Hikari in the computer room staring at the monitor. He asks her what she's doing, and she replies with the word "egg". And then, a digital egg comes out of the computer screen...
Taichi's mother awakens him the next morning, informing him that she is going out and to take care of Hikari. As he gets out of the bed, he wonders about his strange dream last night, and then sees that the sleeping Hikari is holding a large egg. While Taichi cooks breakfast, he discusses the egg wityh Hikari, but only gets whistles from her in reponse. While eating, Hikari drops the egg, which rolls for quite a distance as Hikari and Taichi chase it. It finally stands up on end - and hatches into a Botamon.
Taichi is of course suprised, and even more so when it leaps up and latches onto his face. It then hops off and runs under the bed, and when Taichi tries to follow, it uses Acid Bubbles on him, which knocks him back. However, Hikari, in a way, communicates with it, blowing her whistle and watching the Botamon blow bubbles, which blow all over Hikarigaoka while Taichi wonders what it is.
Taichi invents multiple names for it - Puyosuke, Bota Bota, Gomakuro, and Black Devil - as Hikari feeds it. When Taichi goes out of the room to answer a phone call, he notices the phone doesn't work properly. When he returns, he is suprised to find the Botamon has evolved into a Koromon. To feed the hungry Koromon, Hikari fetches the Yagami's cat's bowl, and the Koromon latches onto Hikari's face in thanks - and then onto Taichi's. Taichi threatens to get rid of it, but just then the Yagami's cat, Miko, comes into the room and attacks Koromon, presumably over the fact it's his food bowl, not Koromon's. Taichi joins the fight, and both Koromon and Taichi get scratches, as Miko leaves with his foodbowl.
Taichi's mother returns home that afternoon with cake, and Hikari and Koromon converse. Taichi, shocked that it can speak, apologizes for Miko. In a sign of friendship, Koromon latches on to both Hikari's and Taichi's faces.
That night, Hikari awakens Taichi as the electronics all over Hikarigaoka are disrupted again. Koromon appears to be sick, and as Taichi and Hikari's drunken father comes home, he evolves into Agumon, breaking several things in the process. A large Agumon. Taichi's father is reprimaded bu his mother, and he insists on going into the children's room to give them a goodnight kiss. Taichi holds the handle so he can't get in, and fortunately he does go away.
However, Agumon jumps out the window with Hikari on his back, and wanders throughout the city, with Taichi following. Agumon attempts to shoot down a plane, and so Taichi is able to find the source of the flames - but there's more electronic disturbances. A massive Digi-Tama appears from the sky, which Agumon attempts to kill, but fails miserably. Hikari, however, refuses to leave Agumon and run.
Parrotmon fires a blast at the bridge above, which collapses on Agumon - but Taichi and Agumon are safe under him, Agumon then evolves into Greymon, and this time fires a blast and does major damage to Parrotmon (read: blasting off a wing). After some hand to hand fighting, Parrotmon forces Greymon on the ground and attacks him again, knocking him out. Hikari tries toblow her whistle to wake him up, but she's too scared to really blow hard. However, Taichi grabs the whistle and blows as loud as he can, which awakens Greymon. Greymon fires a final blast at Parrotmon, killing both him and Parrotmon.
As the sun rises, Hikari cries out for Koromon, and we return to the present, where Taichi says it was an encounter that shouldn't have happened at all - but that's why he's there today.