Eighteen-year-old blue-collar worker Alexandra (Alex) Owens (played by Jennifer Beals) is a dancer in a Pittsburgh, Pennsylvania, tavern at night and a welder at a steel mill during the day. She lives in a converted warehouse with only her pet dog. Her aspiration is to become accepted by a prestigious dance school, the (fictional) Pittsburgh Conservatory of Dance and Repertory. During one of her performances at Mawby's, the bar where she works, she attracts the attention of Nick Hurley (Michael Nouri), who is her boss at the steel mill, and he soon learns that Alex is one of his employees.

Alex's best friends also work at Mawby's, and they have their own aspirations to fame. Jeanie Szabo (Sunny Johnson) is a waitress who aspires to be a professional ice skater, and Jeanie's boyfriend Richie Blazik (Kyle T. Heffner) is a cook who wants to be a professional stand-up comedian. Also prominent in the film is Johnny C. (Lee Ving), who runs the local strip club The Zanzibar, and is accompanied invariably by his strong but unintelligent bodyguard Cecil (Malcolm Danare). Johnny C. visits Mawby's to see the dancers, and tries to recruit both Alex and Jeanie to work at The Zanzibar.

Alex goes to the Conservatory to ask for an application form for an audition, but walks out when she realizes that she lacks any formal dance training, and will have to leave that section of the form blank. Alex's dance teacher and mentor is a retired ballet dancer named Hanna Long (Lilia Skala), who encourages Alex to pursue her dream of becoming a professional ballet dancer. After Jeanie falls twice while auditioning for an ice show, she loses confidence in herself and becomes a dancer at The Zanzibar, where she performs in the nude, and Alex goes to the strip club to rescue Jeanie.

Alex and Nick become lovers, but she later learns that he has an ex-wife named Katie (Belinda Bauer), and they have a hostile encounter in a local restaurant. Nick uses his contacts at the Conservatory to secure an audition for Alex, and just before the audition she goes to Hanna's house and learns that Hanna died the previous night.

At the audition, Alex falls at the beginning of her routine, but starts over and completes the routine successfully. In the final scene, Alex runs out of the Conservatory building with a smile on her face and is hugged by Nick, who gives her a bouquet of red roses. She gives a rose to him, and the film ends with a freeze frame. The ending of the film does not say directly whether Alex wins a place at the Conservatory as a result of her audition.

"Flashdance... What a Feeling" was performed by Irene Cara, who also sang the title song for the similar 1980 film Fame. The music for "Flashdance... What a Feeling" was composed by Giorgio Moroder, and the lyrics were written by Keith Forsey and Irene Cara. The song won an Academy Award for Best Original Song, as well as a Golden Globe and numerous other awards. It also reached number one on the Billboard Hot 100 in May 1983. Despite the song's title, the word "Flashdance" is not used in the lyrics. The song is used in the opening title sequence of the film, and is the music used by Alex in her dance audition routine at the end of the film.

Another song used in the film, "Maniac", was also nominated for an Academy Award. It was written by Michael Sembello and Dennis Matkosky, and was inspired by the 1980 horror film Maniac. The lyrics about a killer on the loose were rewritten so that it could be used in Flashdance. The song was disqualified from the Academy Award nomination when it was publicized that it had not been written specifically for the film. Like the title song, it reached number one on the Billboard Hot 100 in September 1983.

Other songs in the film include "Lady, Lady, Lady", performed by Joe Esposito, "Gloria" and "Imagination" performed by Laura Branigan, and "I'll Be Here Where The Heart Is", performed by Kim Carnes.

The soundtrack album of Flashdance sold 700,000 copies during its first two weeks on sale and has gone on to sell over 6,000,000 copies in the US alone. In 1984, the album won the Grammy Award for Best Album of Original Score Written for A Motion Picture or a Television Special.

Adrian Lyne, whose background was primarily in directing TV commercials, was not the first choice as director of Flashdance. David Cronenberg turned down an offer to direct the film, as did Brian de Palma, who instead chose to direct Scarface (1983). Executives at Paramount were unsure about the film's potential and sold 25% of the rights prior to its release. The role of Alex Owens was originally offered to Melanie Griffith, who turned it down. Producers wanted an unknown for the part. The audition for the part of Alex Owens was narrowed down to a final shortlist of three candidates, Jennifer Beals, Demi Moore, and Leslie Wing before Beals won the part. Flashdance is often remembered for the sweatshirt with a large neck hole that Jennifer Beals wore on the poster advertising the film. Beals said that the look of the sweatshirt came about by accident when it shrank in the wash and she cut out a large hole at the top so that she could wear it again. The role of Nick Hurley was originally offered to KISS lead man Gene Simmons, who turned it down because it would conflict with his "demon" image. Pierce Brosnan, Robert De Niro, Richard Gere, Mel Gibson, Tom Hanks and John Travolta were also considered for the part. Kevin Costner, a struggling actor at the time came very close for the role of Nick Hurley, that went to Michael Nouri.