Three friends - Bhavesh (Shreyas Talpade), Parag (Javed Jaffrey) and Pariksheet (Aashish Chaudhary) live in Pattaya, as paying guests in a house owned by Kiska Miglani (Asrani). Bhavesh works as a chef in a restaurant called Namaste India, owned by Ballu Singh (Johnny Lever). Ballu has a younger brother, Ronnie (Chunky Pandey), who wants ownership the restaurant, because he owes a considerable amount of money to a gangster, Murli (Inder Kumar). Parag is a screen writer for a television channel and Parikshit is a car salesman working for Aarti Gupta (Neha Dhupia). Eventually all three of them lose their jobs. The three friends are later joined by Jayesh (Vatsal Seth) from Mumbai, who is a cousin of Parikshit's, and tells them that an apartment is included if he gets a job at an architecture firm. After getting drunk celebrating Jayesh's arrival, they privately insult Kiska, who arrives back home unexpectedly, hears what they are saying and kicks them out. They go out in search of a place to stay and a friend of Parikshit's suggests paid lodgings. Parikshit and Jayesh go to the home to find its owner is Ballu Singh, to whom they are oblivious of the fact that he is Bhavesh's former employer. Ballu and his wife, Sweety (Delnaaz Paul), agree to let them stay on one condition - they must be married.

Parag poses as Jayesh's wife, Kareena, and Bhavesh as Karishma, Parikshit's wife. Jayesh gets the job and will get the allotment to the flat in fifteen days' time. Ballu Singh and Sweety leave to pick up Sweety's sister, Kalpana (Celina Jaitly). When they arrive home, Jayesh's girlfriend, Alpita (Riya Sen), arrives with them and sees the four friends having (what she believes is) sex. She is instantly outraged at Jayesh and leaves him. Meanwhile, Parag seeks permission to marry Seema from her father (Paintel) and Bhavesh, while wooing Kalpana, finds himself in a situation where Ronnie tries to rape Karishma and in the process of saving Bhavesh, Jayesh nearly drowns him by accident.

While discussing the event with Parag and Parikshit, he discovers the apple he has been eating has half a worm in it, Sweety hears Bhavesh vomit and mistakes him for someone being pregnant. In the meantime, Paintel has agreed that Parag can marry Seema, Aarti has fallen for Parikshit, Kalpana has chosen Bhavesh as her life partner and Jayesh has reconciled with Alpita. The four friends decide that it is time for them to tell Ballu and Sweety the truth. In a shopping centre, an accomplice of Ronnie's sees them and tells Ronnie.

When they come home, they find Ronnie, Ballu Singh and Sweety there, but they do not know that anyone except the villain is there. Ronnie has persuaded Ballu to sign the papers transferring ownership of the restaurant, Bhavesh snatches the papers away and they all end up in a theater showing of Mughal-e-Azam, where they all don various costumes and each make their own humorous attempts to retrieve the documents. Ballu gets back the restaurant and forgives them on one condition - they give them the dream of a small child in the house, which they gladly set out to do.

• Shreyas Talpade as Bhavesh Verma / Karishma
• Javed Jaffrey as Parag Melwani / Kareena
• Aashish Chaudhary as Parikshit Panday
• Vatsal Seth as Jayesh Thakhur
• Celina Jaitly as Kalpana
• Sayali Bhagat as Seema
• Neha Dhupia as Aarti Gupta
• Riya Sen as Alpita
• Johnny Lever as Ballu Singh
• Delnaaz Paul as Sweety Singh
• Chunky Pandey as Ronnie
• Asrani as Kiska Miglani
• Inder Kumar as Murli
• Paintal as Seema's Father

Paying Guests had a weak start but sales picked up in subsequent weeks and the film was declared a semi-hit.

Music is composed by Sajid-Wajid with lyrics provided by Jalees Sherwani, Wajid, A K Upadhyay.