The movie begins with Charlie Hinton, a busy working father and his wife Kim Hinton who has just gone back to work as a lawyer. They enroll their child in the Chapman Academy, a very cool, military-like day care headed by Mrs. Harridan. Soon after, Charlie is laid off after the health division in his company is closed down. Longing for money and no job offers on the horizon for six weeks, he opens up a day care center under the name of "Daddy Day Care" with the help of his best friend Phil. Due to "Daddy Day Care" being significantly cheaper and more laid back than the Chapman Academy, the Chapman Academy begins to lose popularity. As a result, Mrs. Harridan attempts to shut down Daddy Day Care by notifying Child services that Charlie and Phil are not following the Child services rules.