La Reina del Sur is the story of Teresa Mendoza (Kate del Castillo), a 23-year-old woman who is living with her boyfriend, "El Güero" (Rafael Amaya), a drug trafficker and rising star in the Sinaloa cartel. El Güero has been dabbling in his own trade, which is starting to cut into the cartel's profits, and is killed on the order of Epifanio Vargas (Humberto Zurita), the leader of the cartel. Teresa receives a phone call telling her to run. Teresa is unaware that El Güero's death was ordered by Vargas, mistakenly believing that he was killed by rivals in the organization. She trades El Güero's business ledger to Vargas in exchange for his help fleeing the country.
Arriving in Spain, Teresa is referred to work for Driss Larby, a businessman and low-level underworld operator in the Spanish enclave of Melilla on the North African coast. On the ferry, she meets Fátima Mansur, a prostitute who works at Driss' bar "El Yamilla." Teresa proves herself to be an invaluable asset by balancing Driss' books every night. Teresa meets Santiago Fisterra (Iván Sanchez), a Galician ("El Gallego") who works smuggling black market goods such as cigarettes across the strait of Gibraltar into Spain, and his friend Lalo. Teresa and Santiago begin dating, while Lalo dates Teresa's coworker Soraya. Knowing that Santiago is unhappy working the small time, Teresa arranges with Colonel Abdelkader Chaïb (Eduardo Velasco) to get Santiago into the hashish trade. The trade provides huge profits, and Teresa and Santiago move to Málaga.
A year later, Driss Larby is still smarting from Teresa's abandonment, and conspires with a Spanish Naval Officer, Cañagotas (Julio Pachón), who is on Chaïb's payroll, to have Santiago busted during a major drug run. Instead, Santiago crashes his boat into rocks at high speed and is killed, while Teresa is thrown free, arrested, and sent to jail. Santiago's crooked lawyer, Eddy Alvarez (Carlos Diez), subsequently liquidates all of Santiago and Teresa's property and spends it on his mistress.
In prison, Teresa meets Patricia O'Farrell (Cristina Urgel), the wild child in a wealthy Irish-Spanish family whose exasperated father has abandoned her after having had to bail her out of trouble too many times. The two become fast friends—although the bisexual Patricia clearly wants more. Upon release, Patty reveals to Teresa that she knows where a half ton of cocaine was hidden by her late boyfriend, and plans to sell it back to the Russian mob. During the negotiation, it becomes clear to the Russian mob boss, Oleg Yasilkov (Alberto Jiménez), that Teresa's business smarts would be a valuable asset to him. Teresa negotiates the retrieval of the cocaine from its hiding place, under the nose of the confounded Spanish police, the first of many successes in her new career as a rising drug lord.
DEA agent Willy Rangel (Cristian Tappan) travels to Spain, where he begins working with Flores to build a case against Teresa, who is rapidly becoming the most powerful drug trafficker in southern Spain. Backed by Yasilkov, and with the assistance of Teo Aljarafe (Miguel de Miguel), a lawyer and occasional lover of Patty, she opens Transer Naga, a shell company set up to disguise her true business. Shortly afterward, three assassins arrive from Mexico, bent on seeking revenge against Teresa. With Oleg's help, one of them is executed, one escapes, and one, "El Pote" (Dagoberto Gama) eventually becomes her personal bodyguard. Teresa and Teo grow closer, despite her reservations about it, and eventually embark on a relationship.
In the meantime, Willy has brought his assistant, Veronica (Sara Maldonado) to Spain to pose as a love interest for Patty in order to gain access to Transer Naga. Willy also pressures Teo into turning informant, threatening to reveal to Teresa that Teo has been skimming from the company. As months pass, Teresa and Teo attract media attention, and Patty, dumped by Veronica and jealous of Teresa replacing her as media darling, begins a downward spiral of drugs and alcohol. Stalking Veronica in an attempt to get her back, Patty learns the truth about her ex-girlfriend: that she works for the police and has been using Patty to take down Teresa. Distraught, Patty drives the car off of a cliff, killing Veronica. On awakening in the hospital, she tells Teresa everything she knows, then commits suicide.
In Mexico, Epifanio Vargas has been working as the chief of campaign for the next presidential election. His nephew (who is, in fact, his son) Ramiro (Salvador Zerboni) arranges for the candidate to be assassinated, ensuring that the candidacy will go to Vargas instead. Spurred on by the fact that the head of the Sinaloa cartel is about to be elected president of Mexico, the DEA changes tactics and offers Teresa immunity against prosecution if she agrees to testify against Vargas and destroy his political career. At the same time, Vargas asks Ramiro to bring Teresa back to Mexico under the guise of extending an invitation to attend his candidacy, but in reality to execute her because she is the only person still alive who knows about his criminal past.
Oleg presents Teresa with evidence that Teo is a police informant. Teresa sets a trap for Teo and confronts him with the truth, after which Pote executes him. Finding that the Spanish police are trying to obtain an arrest warrant and do an end-run around the DEA, Teresa accepts the immunity deal and agrees to testify against Vargas who, she realizes, has been her enemy all along. On her return to Culiacan, Vargas tries at first to plead with Teresa not to testify but, being unsuccessful, orders her assassination in a raid on the safe house where she is staying. Teresa narrowly escapes, shooting Ramiro in the chest point-blank after he has killed Pote. The next day, she leaves the police station in triumph and Vargas is led away in handcuffs.
A short coda shows a heavily pregnant Teresa, seven months later, living a life of peace and quiet in a seaside villa somewhere in Spain. A high shot of her walking along a pier, holding her belly and smiling, ends the series. In the last few episodes it is established that the show has taken place over the span of approximately thirteen years.