Sarkar 3 is a sequel to Sarkar Raj which itself was a sequel to Sarkar. In the third instalment in the series Sarkar, aka Subhash Nagre (Amitabh Bachchan), after losing both his sons, has shifted into a new house as his wife was not comfortable living in the same home which had seen two deaths. However, Sarkar's sway over the people has not changed. He continues to virtually run a parallel government.
By refusing to carry out the work of Gandhi (Bajrang Bali Singh) and then Gorakh (Bharat Dabholkar), both for a price of course, Sarkar has now won their wrath and enmity. He also has an enemy in Govind Deshpande (Manoj Bajpayee), son of Rukkubai (Rohini Hattangady) and a man with strong political ambitions. Govind hates Sarkar with a vengeance and uses public platforms to openly criticise him and his philosophy. Michael Vallya (Jackie Shroff), another don-like businessman, too, has an axe to grind with Sarkar. And there is Anu (Yami Gautam) who has sworn revenge on Sarkar as he was responsible for the death of her father. Anu is the girlfriend of Shivaji Nagre (Amit Sadh), the grown up grandson of Sarkar.
After staying away from Sarkar, Shivaji now comes to him and expresses a desire to join Sarkar and learn the ropes. Shivaji is brash, hot blooded and over ambitious and he cant see eye to eye with Gokul (Ronit Roy), the most trusted assistant of Sarkar. The Simmering rivalry and differences between Shivaji and Gokul keep coming to the fore time and again.
Ghandi approaches Gokul with an offer to bump off Sarkar and take his place, all with his (Gandhi's) help. But does the loyal Gokul bite the bait? After this begins a game of accusations, planning and plotting, deceit and suspicion. Sarkar doesn't know whom to trust and whom not to. Govind Deshpande's sudden murder has only added to the confusion. There are betrayals and bonding, murder and more murders. What happens ultimately? Does Sarkar's trusted loyal servant Gokul continue to serve him or does Shivaji Nagre take over from Gokul is what forms the rest of the film.