The movie begins with Eriol's old house being demolished, which seemingly activates an unknown Clow Card buried beneath the mansion. Four months have passed since the ending of the TV series. Tomoyo and Sakura review videos showing Sakura in action, showcasing and capturing various cards. As the topic of Syaoran comes across, Sakura wishes to tell him in person that she loves him as well. Later, Sakura goes with Tomoyo to visit Eriol's old house to find it has been replaced with a new amusement park. While they explore the park, Sakura feels a presence similar to that of a Clow Card. As she runs through the park trying to locate the source of the presence, she crashes into Syaoran, who has returned from Hong Kong, with Meiling, for a visit to see the town's annual festival. Sakura is flustered as she still hasn't confessed her feelings for Syaoran, despite his having done so before he left. Syaoran is aware that this is part of Tomoyo and Meiling's plans to give Sakura an opportunity to reply to him. Sakura wants to confess, but despite Meiling and Tomoyo scheming to help, Sakura finds herself tongue tied and repeatedly interrupted whenever she tries to say the words.
While the four walk around town and talk, Sakura doesn't notice her cards are disappearing from her pocket. They eventually notice that parts of the town have vanished, such as a postal box and a small bridge at the park, and Sakura realizes her cards are leaving. At the amusement park, Sakura and Syaoran encounter a mysterious girl who takes away more of Sakura's cards. Later, Eriol calls Sakura and after she tells him what has happened, he explains that the girl and the presence at the park was the Sealed card, the 53rd Clow card, which was set free when his old house was demolished. Containing an equal amount of power as the other 52 cards combined, it was created to balance the positive powers of the cards with a negative one. Every time the Sealed Card steals one of the Sakura cards, it will also take something near her. Sakura will have to convert the card to a Sakura Card to restore the balance, but to do so will require that someone of the card's choosing will lose their most important feeling.
Meanwhile, the students in Sakura's class have been preparing to present a play at the upcoming Nadeshiko Festival. Sakura is the Princess and Yamazaki as the Prince. Syaoran and Meiling attend the rehearsals with Sakura and Tomoyo to catch up with their former classmates. On the day of the festival, Sakura sense the Sealed Card at the school. When she spots it in a void circle, Sakura activates the Sleep card to try to prevent a panic. However, the sleep spell only lasts a short time as the Sealed card quickly steals the Sleep card. While they fell asleep Yamizaki hurts himself and with everyone worried that the play will be canceled Syaoran takes the role instead. During the scene that Syaoran and Sakura are confessing feelings as the prince and princess the stage lights explode and the ground begins to shake. A string of Sakura Cards flies away from Sakura's bag into the dark sky, and the Sealed card steals the people from the play, including Sakura's family and friends, along with huge portions of the entire city. Eventually the only two remaining uncaptured, Sakura and Syaoran rush to the amusement park to confront the card. Sakura's magic proves ineffective against the card. As his magic is not tied to the Clow Cards, Syaoran attacks the card and manages to wound it, but it eventually deflects his attack and wounds him.
Sakura races up the tower after the Sealed card, but gets trapped on the stairs after void spheres leave two gaping holes on either side of her. The Sealed card tells Sakura that she is lonely and just wants her friends, the other cards, back. She doesn't understand why Sakura is getting in her way, but Sakura tells her that true friends do not push each other nor try to bind each other. The Sakura cards pull free from the Sealed Card and surround her. Shocked, the Sealed Card collapses in tears and apologizes.
As Sakura approaches the girl and she orders the rebirth of the card, the card chooses Syaoran (who manages to make it in time) as the one who will lose their most important feeling. Syaoran tells Sakura not to worry, because even if he has to sacrifice his love for her to save everyone, he'll just fall in love with her all over again. However, as the card attacks, The Nameless card (which Sakura created at the end of the TV series) negates it and they combine into a new Sakura card, The Hope card.
Crying and believing its too late, but encouraged by the Hope Card, Sakura still confesses to Syaoran that she loves him and that he is her most important person. To her surprise, he gently replies that he loves her too, and Sakura realizes he didn't lose his feelings after all. As everyone and everything begins to reappear, an overjoyed Sakura uses the Jump Card and leaps to Syaoran before the stairs return to normal with no intention to wait further, despite Syaoran's protests to keep her safe. As she leaps to embrace Syaoran, she exclaims, yet again, "I love you!" The movie ends leaving Sakura in mid-air with their embrace not directly shown in the video. However, bonus artwork released with the film (during it's DVD premiere) includes a large illustrated poster of an extra ending scene showing Sakura successfully making the leap, right into Syaoran's arms, as the pair embrace for a happy ending.
The Special Edition DVD release also features an extra episode following the events of the movie, the Kero-Chan Theatrical special. As Sakura and her friends (including Eriol, who is visiting) are having a tea party, Kero and Spinel Sun battle for the last ball of fried octopus as they pursue it on a pinball trajectory across the town.
