Plot
Royal Tenenbaum explains to his three adolescent children, Chas, Margot, and Richie, that he and his wife, Etheline, are separating. Each of the children achieved great success at a young age. Chas is a math and business genius, from whom Royal steals money. Margot, who was adopted, is a playwright who was awarded a grant when in the ninth grade. Richie is a tennis prodigy and failed artist who is Royal’s favorite among the children. Eli Cash is the Tenenbaums' neighbor and Richie's best friend. Also part of the household is Pagoda, the trusted valet.
Twenty-two years later, Royal, a disbarred lawyer and ex-convict, is evicted from the hotel where he has been living. The children are in a post-success slump, with Richie traveling the world on an ocean liner following a breakdown during a tennis match. Margot is married to neurologist Raleigh St. Clair and is extremely secretive; she has not completed a play in seven years. Raleigh is conducting research on a patient named Dudley Heinsbergen. Chas has become overprotective of his sons, Ari and Uzi, following his wife Rachael's death in a plane crash. First Chas, with the boys, and then Margot, move back into the family home.
Etheline's longtime accountant, Henry Sherman, proposes to her. Learning of Henry's proposal from Pagoda, Royal claims he has stomach cancer in a bid to win back his wife's and children's affections. Richie returns home, and he then lets Royal move into the house and set up medical equipment in Richie's old bedroom.
Margot has been having an affair with Eli, now a successful author who is also a mescaline addict. He tells her Richie wrote to him that he loves her. Royal discovers Margot’s affair with Eli and objects to her treatment of Raleigh. Raleigh and Richie hire a private investigator to surveil her.
Royal observes Chas's overprotective nature and takes his grandsons out for some reckless amusement; Chas berates him for endangering the boys.
Henry investigates Royal's claim to have cancer and discovers that his supposed hospital has closed, his doctor does not exist, and his cancer medication is only Tic Tacs. He gathers the family to tell them that Royal has been lying about his illness, after which Royal and Pagoda are forced to move out of the house.
Richie and Raleigh get the investigator's report on Margot, which reveals that she has been smoking in secret since she was 12 and also has a history of sexual promiscuity. Both men take the news hard; Richie slashes his wrists in an attempt at suicide and is rushed to hospital. As the Tenenbaums sit in the waiting room, Raleigh confronts Margot about her past, tells her he knows that she smokes, and then says goodbye. Richie checks himself out of the hospital and goes home; he and Margot declare their love for each other.
Royal decides that he wants Etheline to be happy, and finally files for a divorce. Before Henry and Etheline's wedding, Eli, high on mescaline, crashes his car into the house. Royal rescues Ari and Uzi just in time, but the boys' dog, Buckley, is killed. Enraged, Chas chases Eli through the house; in the end, they agree that they both need help. Chas thanks Royal. Forty-eight hours later, Etheline and Henry are married in a judge's chambers.
After that, Margot releases a new play inspired by her family, Raleigh publishes a book about Dudley's condition, Eli checks himself into a drug rehabilitation facility in North Dakota, and Richie begins teaching tennis to children. Chas becomes less overprotective of his sons, and Royal enjoys an improved relationship with his family.
Royal suffers a heart attack and dies at the age of 68. Chas accompanies him in the ambulance on the way to the hospital and is the only witness to his death. The family attends his funeral, where the epitaph (which he wrote beforehand) reads that he "Died tragically rescuing his family from the wreckage of a destroyed sinking battleship."
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