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The Cotton Club is a crime-drama film. Gere plays a musician named Dixie Dwyer who begins working with mobsters to advance his career but falls in love with the girlfriend (Lane) of gangland kingpin Dutch Schultz. Hines and Lonette McKee play dancers at the Cotton Club in a sub-plot of the movie.

The movie features many song and dance numbers including fictional performances by Cab Calloway and Duke Ellington. Nicolas Cage plays Dixie's brother Vincent, who also becomes a gangster. Cage's character is based on real-life gangster Vincent "Mad Dog" Coll. Gregory Hines' real-life brother Maurice plays his brother in the film.

The character of Dixie Dwyer is loosely based on the famous 1920s hot jazz cornetist, Bix Beiderbecke, right down to the alliterative name, and everyone simply calling him "Dix." The character "Lila" is loosely based on Lena Horne. Laurence Fishburne's character, "Bumpy Rhodes", meanwhile, is based on Ellsworth "Bumpy" Johnson; Fishburne would later play Johnson in the film Hoodlum.
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