Incident at Loch Ness is a tribute to art documentaries, to documentaries about artists and a mockery of big egos behind their production.

Werner Herzog, one of the greatest documentary filmmakers in the world and a German New Wave representative, is making a new film about the Loch Ness monster. At the same time, the acclaimed cinematographer John Bailey is making a documentary on Herzog. Two film crews embark on a location where conflicts and arguments quickly arise. Soon they realise that they are caught in a hostage crisis orchestrated by the producer megalomaniac and the absurd scope of the situation is suddenly interrupted by the alleged appearance of the monster.