The key male protagonist of Hyderabad Blues is a character called Varun, played by the director Nagesh Kukunoor, himself. The story is centred around his visit to India after living for 12 years in the USA. Varun's friend goes through the rituals of an arranged marriage during his visit. Varun finds himself facing a culture shock in reverse, and he is unable to understand any more, what he had taken for granted earlier. His country of origin is now is as alien to him as his country of adoption.
Soon he meets a young lady doctor who snubs him every time they meet. He falls in love with her and woos her, but wants to get to know her better before committing himself. This expectedly is not expected of him in Hyderabad. After many problems and situations they finally decide to take the plunge.