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Robert Angier (Hugh Jackman) and Alfred Borden (Christian Bale) are two ringers for Milton the Magician. At one fateful performance Alfred ties the wrong knot on Angier's wife who happens to be performing the water trick. She is therefore incapable of releasing her wrists from the rope and drowns. Angier suspects that Borden had tied the wrong knot splits from the job. They both engage in a bitter rivalry as the two of them try to become the world's greatest magicians.

Lucky for Borden, he has a secret. He develops a new trick, "The Transported Man," and Angier finds out. Angier becomes obsessed with this new trick, unable to find out its secret, and begins to believe that it is real. He sets out to steal Borden's journal and succeeds when Olivian Wenscombe (Scarlett Johansson), his assistant, steals it for him. Discovering that the cipher to his journal is TESLA, he sets sail for America and tracks down Nikola Tesla, a brilliant physicist, who aids Robert in making such a trick like Borden's. Tesla warns him about the danger of the contraption, but Robert dismisses him as a result of his obsession.

Strange things happen when Robert performs his trick. He gains great fame during the process as people look in awe at what seems to be pure magic. Lives are lost and relationships are destroyed in this fast paced movie. Not everything is revealed right away, but if you look closely enough, you can find the answer.