College students Paxton (Jay Hernandez) and Josh (Derek Richardson) are traveling across Europe with their Icelandic friend Óli (Eyþór Guðjónsson). In Amsterdam, the three meet a man named Alexei (Lubomir Bukovy), who convinces them to visit a hostel in Slovakia filled with beautiful women. The three board a train to Slovakia, where they encounter a strange Dutch Businessman (Jan Vlasák). When they arrive at the hostel, they are greeted by Natalya (Barbara Nedeljáková) and Svetlana (Jana Kaderabkova), who invite them to the spa, and later to the disco. That night, Paxton and Josh sleep with Natalya and Svetlana, while Óli sleeps with the desk girl, Vala (Jana Havlickova). The next morning, they are surprised to see that Óli hasn't returned, and they are unable to contact him. They are later approached by a Japanese girl named Kana (Jennifer Lim), who shows them a photo of Óli and her friend Yuki (Keiko Seiko), who has disappeared as well.
Although Josh is anxious to leave, Paxton convinces him to stay one more night. That night, Josh and Paxton are slipped tranquilizers, and Josh stumbles back to the hotel room, while Paxton passes out in the disco's storage room. Josh wakes up in a dungeon-like room, and is approached by a man who drills holes into his chest and legs. The man removes his mask, revealing himself as the Dutch Businessman, and tells Josh about his failed dream of becoming a surgeon. After Josh begs to be set free, the Dutch Businessman slices Josh's achilles tendons, and removes his restraints. Unable to walk, Josh attempts to crawl to the door, but the Dutch Businessman slices his throat with a scalpel, killing him.
Paxton wakes up the next morning and returns to the hostel. He gets frustrated with the desk clerk (Milda "Jedi" Havlas), who insists that he already checked out. When he returns to his room, he is greeted by two women, who invite him to the spa in an eerily similar manner to Natalya and Svetlana. Paxton finds Natalya and Svetlana at a pub and asks them if they know where Josh is. Natalya tells him that Josh and Óli are visiting an art exhibit, and she agrees to take him there. They arrive at an old factory, and Paxton is horrified to find Josh's mutilated corpse being stitched together by the Dutch Businessman. Paxton is then ambushed by thugs and dragged down a hallway, passing by rooms where people are being brutally tortured to death. He is then brought into a cell, where he is restrained in a chair and joined minutes later by a German client named Johann (Petr Janiš).
After severing two of Paxton's fingers with a chainsaw, Johann unintentionally removes his restraints as well. Johann charges at Paxton with the chainsaw but slips and severs his own leg. Paxton reaches for a gun and shoots Johann in the head. A guard enters the room but Paxton shoots him and escapes the cell. Paxton enters another room and hides in the bottom of a cart filled with corpses, and severed limbs. A butcher takes the corpses to the bottom floor to be incinerated, and Paxton bludgeons him with a sledge hammer. He then takes the elevator to the top floor and enters the dressing room, where he changes into business clothes, and meets an American client (Rick Hoffman), who mistakes him for another customer.
Paxton escapes the factory but returns after hearing cries for help. He enters another room and discovers Kana being tortured by the American client. After killing the American client, Paxton and Kana flee in a stolen car, pursued by guards. While driving, Paxton sees Natalya, Svetlana, and Alexei, and runs them over, killing them. Paxton and Kana arrive at the train station, but after seeing a reflection of her disfigured face, Kana leaps in front of an oncoming train. This creates a distraction, allowing Paxton to board another train unnoticed.
Once aboard, Paxton hears the voice of the Dutch Businessman. When the train stops in Vienna, Austria, Paxton follows him to a public restroom and throws the Elite Hunting Club's card under his stall. When the Dutch Businessman reaches down to pick it up, Paxton grabs his hand and cuts off the same fingers he lost during his escape. He breaks into the stall and nearly drowns the Dutch Businessman in the toilet, but allows him to see his reflection before slitting his throat and killing him. Paxton then leaves to board another train.
In the Director's Cut, Paxton kidnaps the Dutch Businessman's daughter instead of killing him. After finding her teddy bear in the restroom she was supposed to be in, the Dutch Businessman searches for his missing daughter unaware that Paxton's train has just left.
Principal photography took place in the Czech Republic, and many scenes were shot in Český Krumlov.
Hostel opened theatrically on January 6, 2006, in the United States and earned $19.6 million in its first weekend, ranking number one in the box office. By the end of its run, six weeks later, the film grossed $47.3 million in the US box office and $33.3 million internationally for a worldwide total of $80.6 million.
Review aggregation website Rotten Tomatoes gives the film an approval rating of 61% based on 104 reviews. The site's consensus stating, "Featuring lots of guts and gore, Hostel is a wildly entertaining corpse-filled journey—assuming one is entertained by corpses, guts, and gore, that is." On Metacritic, the film had an average score of 55 out of 100 based on 21 reviews.
Entertainment Weekly's film critic Owen Gleiberman commended the film's creativity, saying "You may or may not believe that slavering redneck psychos, of the kind who leer through Rob Zombie's The Devil's Rejects, can be found in the Southwest, but it's all too easy to envision this sort of depravity in the former Soviet bloc, the crack-up of which has produced a brutal marketplace of capitalistic fiendishness. The torture scenes in Hostel (snipped toes, sliced ankles, pulled eyeballs) are not, in essence, much different from the surgical terrors in the Saw films, only Roth, by presenting his characters as victims of the same world of flesh-for-fantasy they were grooving on in the first place, digs deep into the nightmare of a society ruled by the profit of illicit desire."
German film historian Florian Evers pointed out the Holocaust imagery behind Hostel's horror iconography, connecting Roth's film to the Nazi exploitation genre.
The Guardian film critic Peter Bradshaw wrote that Hostel was "actually silly, crass and queasy. And not in a good way". David Edelstein of New York Magazine was equally negative, deriding director Roth with creating the horror subgenre "torture porn", or "gorno", using excessive violence to excite audiences like a sexual act. Jean-François Rauger, a film critic for Le Monde, a French newspaper, and programmer of the Cinémathèque Française, listed Hostel as the best American film of 2006, calling it an example of modern consumerism. Hostel won the 2006 Empire Award for Best Horror Film. The film's underlying social critique and its link to Marxist and Nietzschean philosophy was debated by a panel at Rider University's 2010 Film Symposium by Dr. Barry Seldes, Dr. Robert Good, and James Morgart.
The film's release was accompanied by strong complaints from Slovakia and the Czech Republic. Slovak and Czech officials were both disgusted and outraged by the film's portrayal of their countries as undeveloped, poor, and uncultured lands suffering from high criminality, war, and prostitution, fearing it would "damage the good reputation of Slovakia" and make foreigners feel it was a dangerous place to be. The tourist board of Slovakia invited Roth on an all-expenses-paid trip to their country so he could see it is not made up of run-down factories, ghettos, and kids who kill for bubble gum. Tomáš Galbavý, a Slovak Member of Parliament from the Slovak Democratic and Christian Union – Democratic Party, commented: "I am offended by this film. I think that all Slovaks should feel offended."
Defending himself, Roth said the film was not meant to be offensive, arguing, "Americans do not even know that this country exists. My film is not a geographical work but aims to show Americans' ignorance of the world around them." Roth has repeatedly argued that despite the many films in The Texas Chainsaw Massacre series, people still travel to Texas.