As the Doctor leaves Earth, the bow of a ship crashes through the TARDIS's wall. The Doctor is momentarily stunned, especially after learning the ship is the Titanic. Pressing some buttons, he repairs the TARDIS walls, pushing the ship out. The TARDIS then materialises aboard the ship. The Doctor soon learns the Titanic is a large luxury spaceship cruiser from the planet Sto, orbiting present-day Earth. He decides to stow away to enjoy the party, only confessing his unauthorized status to lively waitress Astrid Peth, who reveals her own desire to travel the stars.
Astrid has found her new job disappointing, as she is not allowed off the ship to visit destination planets. The Doctor cheers her up by sneaking her onto an excursion toLondon via teleport, along with couple Morvin and Foon Van Hoff and a small alien with a red head, called Bannakaffalatta. Following alien attacks on London on the previous two Christmases, however, London is deserted apart from thr Queen,Nicholas Witchell, and newspaper seller Wilfred Mott. The rest of the population has decided to spend Christmas in the countryside. Ship's historian and guide Mr Copper gives the excursion party a bizarrely inaccurate explanation of human society, especially Christmas, despite the fact that he claims to be an expert on the planet.
The party returns to the ship just as its Captain commits an act of sabotage, causing high-speed meteors to collide with the ship. Midshipman Alonzo Frame, the only other man on the bridge, attempts to stop the captain but is shot by him. The captain is killed in the resulting collision, as are the bulk of the crew and passengers. The Titanic's hull holed in several places, and the TARDIS is left drifting in space before automatically homing in for a landing on Earth. With the teleport system offline and the engines losing power, the Titanic is heading for an extinction-level collision with the Earth. The Doctor makes contact with the injured Midshipman Frame, and leads a small group of survivors in a climb through the shattered vessel to reach him.
Complicating matters are the Host, information androids resembling angels that were seen malfunctioning earlier. Now their sole function is to kill the scattered survivors on the ship. The Doctor's party is harassed by Host all the way, and the Doctor's sonic screwdriver proves to be useless against them. Bannakaffalatta reveals to Astrid that he is actually a, cyborg something considered shameful in the society on Sto. Bravely, he saves the party from a Host attack by transmitting an electromagnetic pulse from his cybernetic implants, killing himself in the process. The Van Hoffs also die during this attack: Morvin falls from the ledge into the nuclear engines, while Foon commits suicide while pulling a surviving Host down with her. At this, the Doctor makes a grim promise that "no more" will die. The survivors take Bannakaffalatta's EMP unit with them as their only effective weapon against the Host.
The Doctor sends the remaining survivors, including Astrid, on ahead with the EMP unit and the sonic screwdriver, while he attempts to reach Deck 31, the place from which the Host seem to be controlled. Using a security protocol, he convinces the Host to take them to their leader. This turns out to be the cruise line's owner, Max Capricorn, who is hiding in an indestructible "impact chamber" on Deck 31. Capricorn is also revealed to be a cyborg, resembling a small wheeled vehicle. Having been forced out by the company's board of directors (due to their prejudice against cyborgs), he is seeking revenge. The collision of the Titanic into a heavily-populated world will not only break the company, but see the board charged with murder, giving Capricorn his ultimate revenge. Outnumbered by Host and faced with death, the Doctor is saved by Astrid, who has made a short range teleport to his position. She rams Capricorn with a fork-lift truck, and in the struggle both are forced off a precipice and fall into the fiery engine of the ship.
With the Host no longer under Capricorn's control, the Doctor grimly makes his way to the bridge just as the ship plunges into Earth's atmosphere. Working with Frame, he uses the heat from the re-entry to try to re-start the ship's engines, but discovers that they are headed straight for one of the few places in London currently inhabited:Buckingham Palace. Calling through with a security code, he manages to get the Queen out of the building, which the Titanic narrowly misses as the ship pulls up, now back under control. The Queen, in her dressing gown, is heard thanking the Doctor as he pilots the ship back into space.
With the danger over, the Doctor suddenly realises that there might be hope for Astrid after all. A safety feature of the ship's teleport system is that in case of accident, it automatically holds in stasis the molecules of the affected passenger. As she was wearing a teleport bracelet at the time of her death, her pattern might still be stored in its buffers. Despite desperate efforts, only a shadow of Astrid can be generate due to extensive damage to the teleport system. The Doctor watches her dissipate into motes of light that float free into space. This way, she can at least fulfill her dream of exploring the universe, forever.
Sadly, the Doctor teleports back to earth with Mr Copper, who is no expert on Earth, but a former salesman who lied his way onto the ship to explore the stars. Impressed by his heroism on the Titanic, the Doctor leaves him on the planet to build a new life, with the ship's expenses card, which contains £1,000,000. The Doctor then heads off in the TARDIS, alone.