Frank Combs is a driver safety trainer in a small town. He is a bit obsessive about driver safety, hence passionate about and good at his job. The kids like him, but he doesn't always get their respect.
The small town's one claim to fame is a serial killer who terrorized the town and neighboring towns in the seventies. Frank is often said to resemble this killer. The killer however wore a big, beautiful, seventies porn 'stache on his upper lip.
Halloween is coming. Frank is very excited about his costume. He is growing a beard for it. No one is able to guess who Frank is going to be at the school's big Halloween dance. The night of the dance, Frank shaves the beard, leaving just the 'stache, puts on some 70s style duds, grabs an axe and walks into the dance as "No More Mr Nice Guy" by Alice Cooper blasts over the sound system. At first kids move away from him, genuinely frightened. Then he gets a slow clap, round of applause. His cool fades and the shy, awkward guy comes back. He's getting much positive feedback.
Later in the night, someone spikes the punch at the dance. The non-drinking Mr. Combs is accidentally intoxicated. He decides to walk home.
On the way home, after puking in front of a yogurt shop full of kids, still carrying his axe, he comes across some "cool kids" who are getting ready to drive off, obviously drunk. He tries to stop them, being lighthearted at first but things heat up pretty quickly. The kids are tossing the keys around, playing keep away, and as he climbs into their huge SUV to get the keys, they jump in around him, grabbing the real keys from the visor, and taking off. He tells them to stop but they don't listen. He puts on his seat belt. Nobody else does. They're going faster and faster to scare their teacher. He takes his axe, reaches the steering wheel with it and intentionally pulls, steering the car off the road where it hits a tree. Everyone in the car dies but Mr. Combs, who comes out mostly unscathed.
Combs walks home, takes a shower. Is visibly shaken. He shaves his mustache off before falling asleep in front of the tv. When he wakes up the news is reporting the accident and its being dismissed as just that, a drunk driving accident where all involved perished. He is relieved, makes his way to the bathroom, grabs aspirin and downs it, shuts the medicine cabinet door and is surprised to see the mustache still on his face.
He mutters that he thought he'd shaved it. He shaves it. He goes out about his Saturday.
At the shopping mall Combs is greeted by, "Great 'stache!" and "Oh god, I thought you were gonna shave that thing." He joins the grieving for the kids that died, much of which is silly and maudlin. He goes home and shaves his 'stache off again. Towels lip dry, as he lowers towel, 'stache is back.
Combs continues trying to lose the 'stache but it won't go away. He gives up. He goes about his life. Things seem normal except that now he is increasingly enraged when he sees unsafe driving and he sees it EVERYWHERE, until, finally... he snaps. Combs starts killing kids for not driving safely, always making it look like they died from unsafe driving practices. Comedic high point when he is getting very upset at a kid playing with Hot Wheels in the park, and steering the Hot Wheels recklessly. The kids mother saves his life when she scoops him up and gives Combs a dirty look. The kid sticks his tongue at Combs who does a finger across the throat threat back at him.
Climactic scene when Combs gives up on the entire Senior class, hi-jacks the class trip bus, and goes on a rampage on the freeway. He runs people off the road who try to pass on the right, slams on the breaks when tailgated and teaches class all the while telling the kids how to drive safely. The one misfit kid who always treated the teacher good gets his trust, gets him to pull over, and then grabs him, and throws him out of the bus into traffic where he is killed.
At the end of the movie misfit kid and a female friend are putting flowers on Combs' tombstone. She touches his upper lip and says "Are you growing a mustache?" Misfit answers, "No!" somewhat incredulously. They get in her car and he notices her rearview mirror is broke. "You shouldn't be driving with that like that." She laughs it off. He looks in the passenger side mirror and sees a mustache on his face. He is confused. The car drives off into the sunset.