The wedding between Will & Elizabeth is cut short by Lord Beckett, who seems to be a head honcho of the East India Trading Co. History ppl. know that the india trading companies were big **** back in the day. So anyways, he says that Will and Elizabeth and Norrington (who resigned and left a while ago, we are told) are sentenced to death for aiding in the escape of a fugitive. Soon, Beckett calls in Will and tells him he can grant pardon for elizabeth if he gets Jack back to Port Royal (where they are) and he can get Jack's compass (which shows exactly what the holder wants). He wants the compass to find Davy Jones's chest so he can use it as leverage against him and gain control of the seas for the EITC. Jack in turn will be made an employee of the EITC. Will agrees and goes to find Jack.
In the meantime, Jack has found a picture of a key, the key that will open Davy Jones's chest, which holds his heart; he who controls the chest controls Davy Jones. Jack needs some leverage against Davy Jones because he made a deal with Jones to be captain of the black pearl for 13 years in trade for the remainder of his lifes' service to Jones. So Jack is going to go look for the key and chest when late one night, Bootstrap Bill Turner (Will's dad) comes and tells him his 13 years are up (apparently, calling yourself a captain when you've been mutinized still counts as captainship) and Davy Jones is sending the Kraken (a sea monster) to get him so he can pay his dues. He gives Jack the black spot (I laughed at this because I remember Muppet Treasure Island lol). So Jack lands on an island to get away from the sea monster.
In the meantime again, Elizabeth gets out of jail again, gets will's name added to the list and sets out to find Will and Jack. She ends up in tortuga later.
Meanwhile, Will gets onto the island where Jack is on (and in reality, the island has no purpose aside from a meeting place, but its all good fun). The island is a cannibal island, so they escape. Jack tells Will that he will give up the compass if Will gets the key. They head for a witch's hutt then, who tells them where to find davy jones, so Will can get the key. They find Davy Jones, and Jack strikes a deal with him for 100 souls, including Will's in trade for his own. Selfish Jack. Davy gives him 3 days, so Jack heads to tortuga.
Will is reunited on Davy's ship, the flying dutchman, with his father; they both play a betting game against davy, each betting an eternity of servitude against Davy's key, which he holds with him. Bootstrap bill bluffs and loses (the game is like BS, the cardgame, but with Dice), he does so to save Will, and so Will promises to find a way to free his father from servitude. He also gets the key from Davy while he sleeps and escapes, only to have the ship he finds sunk by the kraken, so he hides back on the dutchman.
Meanwhile, Jack has gone to tortuga to elect helpless souls for his 100 soul debt. One of which turns out to be norrington! The Elizabeth joins up with them. Jack, still looking for the key and up to this point having trouble with his compass because he doesnt know what he wants (the compass points you in the direction of what you want), tells Elizabeth that the possession of the chest will get her Will back, so he gives her the compass and they are off to find Will.
Eventually, (and after they establish that Elizabeth has the hots for Jack) they all get to the island where they find the chest. Will arrives there too. Will wants to stab the heart, effectively killing Jones, to free his father; Norrington wants to return the chest to Beckett to regain his position; and Jack wants to use it as leverage so that Jones doesnt use the kraken against him and so that Jones doesnt die, setting the kraken free. Jones heart was cut out by himself by the way. Anywho, the three men get in a fight, and Jones sends his men after the chest, and there is also a chase scene. Eventually, through much mumbojumbo (enjoyable though it is), Norrington gets the heart, Jack thinks he has the heart but finds he doesnt, Norrington runs away, Jack tries to sail away with everyone else, and the kraken comes after them. Eventually, they all bail, but Elizabeth starts the makey outey with Jack and ties him to the ship because the kraken is only after Jack. The rest escape, but Jack is able to wriggle free of his holdings only when the kraken arrives; he dives into the krakens mouth with sword drawn and the black pearl is taken down.
Norrington delivers the heart to Beckett, the rest go to the witch again, who says that if they want jack and the black pearl back, they will need to sail to the ends of the earth (america??) with an experienced captain. Enter Captain Barbosa (Geoffrey Rush), who "died" in the last film (his boots can actually be seen earlier this film which i didnt notice the first time i saw it, but which indicates the witch was nursing him back to life)! And so it is set up for another sequel