

The film ends with Danny and Sandy departing in the Greased Lightning car together, which then takes flight, and the pair waves goodbye to their friends. In song, the two admit they love each other and reunite. Danny has become a jock, but is shocked when Sandy appears dressed in leather and is seen smoking. Rizzo discovers she is not pregnant after all and reunites with Kenickie. On the last day of school, while Principal McGee and her assistant Blanche sob about the departing class, the class celebrates their graduation at the fair on the school grounds. Sandy watches from afar, concluding she still loves Danny and decides to change her attitude and look to impress him. He and Leo race until Leo crashes and leaves humiliated, with Danny as the victor. The race arrives, but Kenickie is knocked out by his own car door thanks to the careless behavior of his friend Putzie, so Danny takes up the challenge. Meanwhile, Rizzo fears she is pregnant after missing a period and confides to Marty, but Sonny overhears and spreads the rumor which eventually reaches Kenickie who is the potential father.

Danny tries to make it up to Sandy by taking her to a drive-in theater but ends up making several passes on her, causing Sandy to flee. During a dance, Danny and Cha-Cha (who were once boyfriend and girlfriend) perform together and win a dance-off. Kenickie humiliates Patty Simcox by lifting her dress up in front of the whole school. Rizzo and Kenickie attempt to spite one another by bringing Leo and Cha-Cha as their dates, while Danny and Sandy come together. The school dance arrives, broadcast live on television and hosted by DJ Vince Fontaine, who flirts with Marty. Left alone, Frenchy is visited by a guardian angel who advises her to return to Rydell High after a mishap in beauty class leaves her with candy-pink hair. He reunites with Sandy and they attempt to go on a date, but their friends crash it, resulting in Kenickie and Rizzo arguing and parting. Wishing to win his way back into Sandy's affection, Danny turns to Coach Calhoun to get into sports, eventually becoming a runner. The two are disturbed by Leo, leader of the T-Birds' rival gang, the Scorpions, and his girlfriend Cha-Cha, leading to a planned race between Kenickie and Leo. The T-Birds almost crash the party in Kenickie's Greased Lightning car, but a guilty Danny leaves, followed by Rizzo, who departs to make out with Kenickie, who is actually her boyfriend. Frenchy invites the girls to a pajama party, but Sandy falls ill from trying a cigarette and drinking. Upon learning Danny is Sandy's sweetheart, Rizzo arranges for the two to reunite, but Danny is forced to maintain his bad-boy attitude in front of his pals, upsetting Sandy. Oblivious to each other's presence at school, Danny and Sandy tell their respective groups the accounts of events during the pair's brief romance. After her parents decided not to return to Australia, Sandy enrolls at Rydell High and befriends Frenchy, who considers dropping out of school to become a beautician. The Pink Ladies also arrive, consisting of Rizzo, Frenchy, Marty, and Jan. Danny, a greaser, is a member of the T-Birds, consisting of his best friend Kenickie, Doody, Sonny, and Putzie.

The film moves to the start of the seniors' term at Rydell High School. When the summer comes to an end, Sandy-who is going back to Australia-frets that they may never meet again, but Danny tells her that their love is " only the beginning". In the summer of 1958, local boy Danny Zuko and vacationing Sandy Olsson meet at the beach and fall in love. 4.4 American Film Institute Recognition.
