This spoiler was submitted by Jeremy

England, 1867 - A young Sherlock Holmes (Hector Bateman-Harden) is dropped off at a boarding school by his mother. Almost immediately, all the other kids start to pick on him and bully him. Sherlock keeps to himself until the kids appear to apologize and try to help him kiss a girl he likes. The kids blindfold Sherlock and make him kiss a donkey's behind. As the kids laugh at his humiliation, Sherlock decides from that day forward that he will close off all emotions and devote his life to solving crimes. He sucks a tear back into his eye and starts deducing other dirty deeds the kids were doing that can get them expelled, so they leave Sherlock alone for good. He then meets young John Watson (Codie-Lei Eastick), and the two become lifelong friends.

In the present day, Holmes (now played by Will Ferrell) and Watson (now played by John C. Reilly) are preparing to head to the trial of Holmes's greatest nemesis, Professor James Moriarty (Ralph Fiennes). With only about 15 minutes left before the judge lets Moriarty free, Holmes and Watson are held back when their housekeeper Mrs. Hudson (Kelly Macdonald) brings them a package from Moriarty. They open it and find a supposedly deadly mosquito flying around the room. Holmes and Watson smack each other to kill the bug until Holmes deduces in his head that at the proper angle, he can squash the mosquito without damaging the glass case of bees it is perched on. Holmes splats it, but his theory is wrong, and the case breaks, releasing the swarm of bees upon the room.

The judge is about to let Moriarty free until Holmes and Watson arrive in the nick of time. Holmes gives his testimony, concluding that the man standing trial is not guilty because it is not Moriarty. He is someone named Jacob Musgraves, set up to take the fall for Moriarty, and Holmes states that he could not have carried out any murders that Moriarty is guilty of because Musgraves has a tremble in his hand caused by too much wanking, and that the real Moriarty is heading to America. Inspector Lestrade (Rob Brydon) argues with Holmes that letting this man free will only lead to more murders, but Holmes brushes off Lestrade's warnings.

Holmes and Watson are invited to Buckingham Palace by Queen Victoria (Pam Ferris). It turns out to be a surprise party for Holmes, though Watson makes it weird because he is infatuated with the queen. They bring out a giant cake shaped like a magnifying glass, only for Holmes and Watson to cut into it and find that there is a corpse inside, along with a note from Moriarty stating that he will kill the queen in two days time. Lestrade takes the time to chide Holmes for failing to stop Moriarty.

Holmes and Watson go to the morgue for an autopsy on the corpse. They meet the American Dr. Grace Hart (Rebecca Hall), and her developmentally challenged companion Millie (Lauren Lapkus), with whom Holmes becomes enamored. Watson joins Grace for the autopsy, where he tells her that he wishes Holmes would view him as a co-detective. They start to clean the frosting off the corpse, which then turns weirdly sexual. After Lestrade arrives, Watson concludes that the cause of death is indeterminable.

Back home, Holmes poisons Watson to prove his theory that the victim was poisoned. He figures that the poison must have come from a man named Gustav Cringer (Steve Coogan). They travel to a seedy part of London to get a lead. After one failed lead, they follow two tattooed men who got their ink done by Gustav. They head inside a building where they find Gustav, as well as Moriarty. Holmes and Watson are then forced to fight a brutish henchman of theirs, but Watson takes care of him with multiple bashes to the head with a chair. Before Gustav can give Holmes the information he desires, he is stabbed in the back by Moriarty. Holmes grabs the knife and throws it at Moriarty, who is then revealed to be Musgraves again.

Queen Victoria visits Holmes and Watson to stress how urgent it is that they find the true killer. The two then try to get a "self-photograph" with the queen, but Watson accidentally knocks her out with the oversized camera and they think she's dead. They start to panic as the guards outside are banging on the door, but Victoria wakes up before the guards suspect foul play.

Holmes and Watson go seeking help from Holmes's brother Mycroft (Hugh Laurie). The two try to communicate telepathically, which Watson tries to get in on, but he is sent to a room with other rejected companions, including the Elephant Man. Mycroft helps Holmes figure out that the killer is someone who is always near him and knows every facet of his life.

Holmes gathers his closest associates together, along with Grace and Millie, to tell them all that he believes the killer to be Watson. Watson is then arrested and sentenced to hang for his crimes.

Soon, Holmes realizes what a terrible mistake he's made, and he opens his emotions for the first time in years after he feels terrible for condemning his best friend. This leads to an over-the-top musical number in which Holmes and Watson sing their love for each other, and Holmes saying that he pushed Watson away because he thought he was losing him to Grace. Watson then has a visitor in his cell who brings him red velvet cake.

Holmes gets help from the street children to help save Watson. He finds Watson's cell empty except for the plate with cake crumbs. Holmes figures that the killer is none other than Mrs. Hudson, as she makes that cake, and it's Watson's favorite, so he wouldn't leave crumbs unless it was to send Holmes a message. Sure enough, Mrs. Hudson has Watson prisoner and is forcing him to write a negative story on Holmes before carrying out her plan to kill the queen under orders from her father, Moriarty.

The murder is set to take place on the Titanic, where the queen and other guests will be targeted. Mrs. Hudson waits outside on a boat with her henchmen. Holmes finds Watson tied to the gears inside a clock. He apologizes to his best friend, not realizing Watson is begging to be cut loose. The two then head to the main room where they find a rare drum that they figure must contain the bomb. Holmes tries to come up with a plan to stop the bomb, but he keeps getting distracted by thoughts of Millie. Watson then decides to charge through the room and rip through the drum and pull the bomb out. He throws it out the window where it lands in Mrs. Hudson's boat and blows her and her henchmen up.

The queen commends Holmes for solving the case, but he gives credit this time to Watson for helping him. Watson and Grace kiss before parting ways, and Holmes talks to Millie, who speaks for the first time to tell him that she was playing stupid as an experiment on how easy it is to manipulate men. They share a kiss too before she and Grace board the Titanic on a "safe" voyage. Also Billy Zane shows up for a cameo.

Holmes and Watson return home where Holmes shows Watson that he got a plaque in the front of the building to establish Watson as a co-detective. Watson is elated, even if the plaque is smaller than the large one Holmes has.

We then cut to Wyoming where the real Moriarty is hiding out in a bar. He then receives a message saying Holmes and Watson know where he is, and they are coming for him. Moriarty looks up to find the detectives smiling at him from the bar.

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Legendary detectives Sherlock Holmes and Dr. John Watson are tasked with stopping Professor James Moriarty from killing Queen Victoria. However, the real Moriarty has fled to America while he left a decoy behind to throw Holmes off the trail.

Holmes mistakenly believes that the real killer is Watson after his brother Mycroft tells him that the killer must be someone close to Holmes. The real killer is the housekeeper, Mrs. Hudson, who is really Moriarty's daughter. She plants a bomb on the Titanic where the queen will be, but Holmes and Watson foil the plan and throw the bomb toward Mrs. Hudson, blowing her up.

Holmes and Watson rekindle their friendship, and Holmes names Watson co-detective. The two then head to America to catch Moriarty.

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