Barbie stars as Blair Willows, a young girl who lives within the kingdom of Gardenia with her sickly mother and younger sister, Emily, while working as a waitress at the Cafe Gardenia in order to help support them.
Upon returning home from another long day of work, Emily watches the annual "Princess Procession" on TV, which shows princesses from many other kingdoms coming to enroll at the original Princess Charm School, a school teaching proper princess etiquette, in order to learn their full potential. Each semester, one commoner is also allowed enrollment if she wins a lottery that awards a full scholarship and the chance to become a Lady Royal, a princess's most trusted adviser.
On the TV, Blair, Emily and their mother watch as Blair is picked as the lottery winner. It is revealed that Emily had secretly entered Blair's name multiple times each day. Initially, Blair doesn't want to leave her family behind, but her mother sees it as a good opportunity for her daughter and convinces her to go. Blair parts ways with her family and leaves to go to the school in a carriage driven by an employee named Brock.
At the school, Blair is greeted by a large golden retriever named Prince that takes an immediate liking to her and knocks her over. The headmistress of the school, Alexandra Privet takes Blair to her locker while talking about the school. Blair, at her locker, meets a fairy named Grace, Blair's assigned personal princess assistant.
Blair uses her magically-infused locker to change into her school uniform, after which Grace brings them to Blair's dorm room in order to get settled in. There, Blair meets her new roommates, both of whom are princesses: Isla, a timid musician, and Hadley, an outgoing athlete, and their assistants, Caprice and Harmony.
Soon after, Miss Privet announces that every student is to head to the Starlight Welcome immediately, in order to receive their training crowns. At the welcome ceremony, Miss Privet explains that the princesses will get real crowns after successfully completing the semester. Another teacher at the school, Dame Devin, declares that she will quit her job instructing at the Princess Charm School after her daughter, Delancy, who is also attending the school, becomes the new princess of Gardenia at the end of the semester. She goes on to explain that both she and her daughter have lived at the royal palace since her sister-in-law, Queen Isabella, and her family died in a car crash many years ago. Isla and Hadley, seated with the rest of their fellow students, tell Blair about a well known legend which claims that not everyone from the Royal Family had died in the crash.
After the ceremony, each student has a curtsying class before dismissal for the evening, and Blair gets distracted by Hadley and Isla's continued tale and bumps into Delancy, who seems to have already developed quite a strong dislike for Blair, and openly expresses her disdain over the school's lottery system of allowing commoners to enroll. Isla and Hadley comfort Blair, telling her that they are positive that Blair can do anything Delancy can do.
The next day, Blair's momentary confident instantly becomes unraveled upon witnessing Delancy being able to walk about with a very large stack of books on her head without any sort of difficulty during one of their lessons, when she, herself, can't even balance one. Many of the other girls, however, do have a few problems, themselves, but Dame Devin, the lesson's instructor, seems more keen upon singling Blair out the most. However, upon getting a better view of Blair's face, Dame Devin becomes immediately, and curiously shocked. She then ruthlessly tells her to get out of her class and states that she doesn't belong at such an establishment.
Later on, at lunch, Delancy, inspired by her mother's viciousness, makes her sprite assistant Wickellia secretly tuck a piece of tablecloth into Blair's skirt while she, Isla, and Hadley unknowingly continue on within their meals. As a result, Blair ends up being further embarrassed with herself when she unexpectedly drags each girl's trays clear off of the table upon standing.
Back within their dorm room, Isla and Hadley try to cheer up Blair by telling her that Dame Devin, herself, was once a lottery winner, as well. However, none of the princesses at the time had selected her to be their Lady Royal, not even Queen Isabella.
Afterwards, a knock upon their door is heard, and Hadley goes to open it, revealing a struggling Grace holding onto a large care package addressed to Blair, from her sister Emily. Inside are various letters and other items, including a drawing of a baby Blair being left on their mother's doorstep. Blair explains to her curious friends that she is adopted, and so too, is Emily, and that the drawing is in reference to a tale which is favorite of Emily's (told to her by their mother), in that Blair had suddenly been found upon their mother's doorstep when Blair was one-year-old. Miss Privet, who arrives at the girls' dorm room in order to tell Blair a bit of bad news regarding her continued enrollment, then stops herself from doing so upon unintentionally eavesdropping.
The following day, this time at a ballroom dancing class, Blair continually manages to step onto the toes of Delancy's friend, Portia, who is Blair's dance partner. As a result, Blair is kept behind after class by Miss Privet, who had been the instructor. Now alone, she tells Blair that Dame Devin wanted her to be expelled, a desire which had almost been granted; however, Miss Privet admits to Blair that she is aware of her personal reasons for wanting to become a Lady Royal (which is solely to better support her family), and so decides to tutor her, herself. She goes on to explain to Blair that each lesson her students learn simply isn't for superficial reasons, but rather to instill a better sense of character and confidence within each of girl.
As wintertime arrives, the charm school students are one day joined by the young men from the "Prince Charming Academy" (the male counterpart to their own establishment) for one of their dance classes. Blair inevitably gets partnered with a young prince-to-be named Nicholas, who appears to be every bit as down to earth and friendly as she. As a result, the two seem to hit it off, as they share various jokes with one another while dancing. Jealous, as she had been hoping to dance with Nicholas herself, Delancy trips Blair in order to once again humiliate her; however, Nicholas helps Blair quickly recover, as the two lead the overall group (sans Delancy). When they are done, the men leave, much to the regret of the women, but Miss Privet assures them that they will again return in order to attend the dual graduation ceremony, and coronation of Delancy as the princess of Gardenia at the end of the semester.
Springtime eventually arrives, and now with only two days before the ceremony, where both the princesses and Lady Royals will be crowned, Miss Privet announces that the girls will get to spend another one of their table manners classes within the palace this time. Blair, Hadley and Isla go with their sprites (along with the rest of their fellow students) to pamper themselves within the school spa as a preparatory treat, while Dame Devin secretly instructs Wickellia to rip up the girls' uniforms (which they are not allowed within any class without). Meanwhile, Isla and Hadley continue to tell Blair more legends about the Royal Family, including one about Gardenia's magic crown, which lights up when put upon the head of the rightful heir to the throne.
The girls head back to their room to find their uniforms torn to shreds. As both Isla and Hadley lament over the fact that they cannot attend class without them on, and that missing any class will result within an automatic failure, Blair, having now grown a bit more confident over time, creates some new, personalized uniforms using leftover fabric from the old ones.
Having just made it to the palace in time, Blair, Isla, Hadley, and the rest of the students are awarded a bit of free time to explore the first floor before the start of class. While doing so, the trio mysteriously find a portrait of Blair, which actually turns out to be the then Princess Isabella, when she was eighteen-years-old, the same age as Blair. The girls then see a portrait of the entire Royal Family: Queen Isabella, her husband, King Reginald, a puppy which Blair is stunned to realize is actually Prince, the dog, and a young baby girl in the Queen's arms.
Upon further inspection of the portrait, Hadley and Isla begin to surmise that perhaps Blair could be the baby from the picture, and proceed to ask her when exactly it was that her mother had found her as a baby. Blair reveals the date to be April 26, a date which had also become her birthday when her mother found her on her doorstep, as she didn't know when Blair was actually born. Stunned, however now more convinced than ever that their suspicions are correct, both Isla and Hadley reveal to Blair that April 26 was the very same day that the Royal Family had perished within their car accident. They go on to say that they believe that perhaps Princess Sophia hadn't died with the King and Queen, after all, but rather had been found and left in front of somebody else's door to be raised.
This hypothesis also makes them realize that this was the most probable reason why Dame Devin and Delancy have continually been so unfair to Blair, because she and Princess Sophia are one in the same and thus, is the rightful heir to the throne of Gardenia. Unbeknownst to the trio, Delancy has eavesdropped upon the entire conversation, and promptly becomes disturbed by the news, as her mother had never told her these things.
Later on at class, Dame Devin reveals to her students her intentions for Gardenia (which she passes off as Delancy's) once her daughter is made princess: to bulldoze the beggared areas of the land and create parks in their place, in order to make the overall kingdom more beautiful. Blair is shocked by this, and informs her that her family lives there, but Dame Devin heartlessly remarks that she should then leave the school immediately in order to move her family to a new home in time, not at all caring that such an act would be impossible for them, as they have no money. Blair attempts talk to Delancy to see sense, but she remains silent, worried about what her mother will do further when she is a princess.
Blair runs away in her room, feeling utterly broken and defeated. She does as Dame Devin had instructed and packs up her belongings in order to leave the school once and for all; however, upon gazing at her sister Emily's sent drawing once more, decides to stay and to finally fight back.
Meeting back up with Hadley and Isla, Blair informs them that she intends to locate the magical crown so that she can use it to prove that she is the rightful heir, and thus successfully stop Dame Devin's plans from coming true. Her friends naturally volunteer to help, and so the trio then plan to go back to the palace later that night to search for it, before the graduation and coronation the following day.
That evening, before the girls can leave, a fire alarm suddenly goes off. The students all go outside accordingly, while Dame Devin secretly places three pieces of her jewelery within Blair, Hadley and Isla's dorm room in order to implicate them and finally have them expelled. Delancy sees her leaving the room and becomes suspicious, but her mother quickly changes the subject by asking her why she suddenly has a customized uniform like Blair and her friends, to which Delancy coolly explains it's simply because she likes the way it looks.
A little more than half an hour later, the students can finally go back into their rooms, but Blair, Isla and Hadley are abruptly stopped by a guard, Dame Devin, and Miss Privet. They are then accused of stealing Dame Devin's jewelery, about which they naturally dispute. However, upon searching their dorm room, the guard successfully locates each missing valuable.
The girls are then to be detained until after the coronation ceremony; however, while the guard is taking them away, Delancy suddenly approaches and stops him, claiming that she wishes to carry out their punishment herself (and as she is to be princess within just a few hours, she says he will have to follow her orders). At first hesitant to listen to her, every student within attendance witnesses and she hesitantly asks Blair if she truly is Princess Sophia, to which Blair responds that she believes she is. Delancy then quickly hands over a map of the palace basement where the magical crown can be located, further revealing to them that she is assisting their efforts because she wants to do what is right for the kingdom. Before parting ways, she also tells them she will leave a window open on the third floor of the palace for them to enter through, and then runs off back to her room, as her mother believes her to already be asleep.
Blair, Hadley and Isla head back to the palace, and find Prince thankfully distracting another guard for them. They then use a rope from their bag to climb up to the third floor window, before then taking an elevator inside to the basement. Hadley notices devices on the walls within the room, and recognizes them as invisible laser alarms which will set off its detection if any are stepped through. Blair carefully blows a bit of makeup powder towards the lasers in order to make them become visible. Hadley, the most athletic of the three, utilizes some of her impressive gymnastics abilities in order to bypass the beams and make it to the other side, while both Blair and Isla make a far more slower trek across, with some help from Grace.
Once there, there is a keypad which needs a password to unlock a vault door, most probably where the magical crown is being held, so they try the date of Delancy's coronation. It is incorrect, however, and so they use the password hint ("The day it all fell into place") to figure out the real password. They then try the date of the car crash and it works. Inside the room are several of Dame Devin's possessions. Blair and her friends find the magical crown, but Dame Devin finds them, and makes Brock, her guard, seize the crown from them. She then changes the password, with Isla memorizing the tune of the pressed buttons, and locks them inside of the vault.
The girls are stuck within the vault for several hours, right up to when the coronation begins and Delancy becomes moments away from being officially crowned. Seeing that they have yet to arrive, she figures out how to stall the proceedings while Blair and her friends try to find a way to escape. Isla, meanwhile, keeps humming the tune of the keypad buttons, and Hadley, who had been attempting to pry open the vault doors with a sword she had found, accidentally knocks the cover off a nearby box of electrical wires.
Seeing this and realizing that it is most likely connected to the vault's stored password, they wire up Blair's phone to the keypad to use her phone buttons to enter the password from inside of the room. Isla, having memorized the new password, she carefully hums out the tune before entering it onto the phone. Successful, they finally make their hurried escape.
The girls arrive at the graduation ceremony just in time, and Blair confidently makes an open claim to the throne, stating that she is Princess Sophia. Emily and her mother, who are watching the action on the TV, gasp in shock.
The royal judge, who crowns the princesses and Lady Royals, takes Blair seriously, but Dame Devin, now furious, tries to stop her. They begin to fight over the crown, before Delancy manages to catch it and then has to decide whether to give it to her mother or to Blair. In the end, she chooses to give it to Blair, and when she puts it on, it immediately illuminates and transforms her appearance magically, to look more like a princess, much to Dame Devin's shock. The students are convinced that Blair is Princess Sophia.
Dame Devin, amidst her outrage, unknowingly and publicity exclaims that she was the one who had Queen Isabella and King Reginald murdered in the car crash just so that Delancy could be rule one day as queen and not Blair, shocking everyone (including Blair's mom and Emily). Dame Devin tries to say otherwise, but the judge who was angered by her involvement in Isabella's murder orders for Devin arrest. A disheartened Delancy watches on as Devin is dragged away and she angrily swears vengeance. At Miss Privet's prompting, Blair makes a quick, introductory speech, telling the people of Gardania that she is honored to be their princess. Miss Privet then tells her that now is the time when she must select a Lady Royal, and Blair, in gratitude, chooses Delancy, who is delighted and then crowned.
Later that evening, at the graduation party, everyone dances to Isla's one of her finally revealed songs, "We Rule This School," which she also DJs for. Even Miss Privet dances along with her students, while the now Prince Nicholas arrives and meets up with Blair again. He states that he is unsure of whether to call her Blair or Princess Sophia, but she assures him that she wants to continue going by the name "Blair."
The new Lady Royal, Delancy, then announces that the Princess has some special visitors, which are revealed to be Emily and her mother. Blair welcomes them to their "new home". Emily then asks Blair if, since Blair is now a princess, does that also make her one, as well. Blair warmly tells her: "Of course; there's a princess in every girl," before stating that she wishes to introduce both she and their mother to everyone as the credits roll.Diana Kaarina as Blair Willows/Princess Sophia - the poor waitress of "Cafe Gardania" who wins a scholarship to Princess Charm School. She is kind, clever and clumsy, yet diligent. She loves her family and wants to support them. It is later revealed that she is Princess Sophia, the long lost princess of Gardania.
Morwenna Banks as Alexandra Privet - the headmistress of Princess Charm School.
Nicole Oliver as Dame Devin - a vindictive school teacher at Princess Charm School, who is also the mother of Delancy, the former heir presumptive to the Gardanian Throne. She is also the late Queen Isabella's sister-in-law. She was arrested at the end of the movie as she revealed that she killed the royal family on purpose by plotting a car accident.
Brittney Wilson as Delancy Devin - one of the charm school's students, Dame Devin's daughter, and originally was to be crowned as the ruler of Gardania until she found out that her cousin Sophia had survived the car accident her aunt Isabella and uncle Reginald were killed in. She later becomes a Lady Royal to her cousin, Princess Sophia/Blair Willows.
Ali Liebert as Princess Hadley/Princess Portia - Hadley is one of Blair's best friends and fellow student at the charm school, who loves sports. Portia is Delancy's airheaded friend and fellow student at the charm school.
Shannon Chan-Kent as Princess Isla - another one of Blair's best friends and fellow student at the charm school, who loves music.
Vincent Tong as Prince Nicholas - a prince who attends Prince Charming Academy, and later befriends Blair.
Madeleine Peters as Emily Willows - Blair's younger sister who secretly enters her into the Princess Charm School lottery. She is young girl and also, has a very kind heart.
Ellen Kennedy as Blair's adoptive mother. She loves her adopted daughters as just like they are her real daughters.
Miranda Ram-Nolte as Princess Miranda