Mrugaraju is action based movie in which, In a jungle, there lives a man-eating lion. The latest victim of lions havoc is the death of the chief engineer who is constructing the rail bridge. The Railway department asks Aishwarya (Simran) to go on the mission of constructing the bridge. Even after Aishwarya resumes the duty, Lion starts terrorizing the crew of the construction team.
The ace hunter of Adavipalli, Raju (Chiranjeevi), is entrusted with the job of hunting the lion. The rest of the first half is all about how Raju traps the lion and kill it at the cost of Appanna Dora (Nagababu). But, the other lion in the jungle gets enraged at Raju for killing its companion. There is another trouble for the bridge project in the form of forest ranger (Surya) and a local smuggler (Ramireddy).
Raju gets rid of these two goons by the interval. Then the viewers are revealed that Aishwarya is the wife of Raju. In the second half, the flashback is revealed. Raju comes to city to participate in the crafts mela to sell his herbs from the jungle. There he meets Aishwarya, who is come to visit a fun stall along with his fiancee Vicky (Raja Ravindra).
Rest of the story is about how Raju killes the lion.