Jackie and Luke Harrison are a divorced New York City couple struggling to help their children Anna and Ben be happy with this sudden change of lifestyle. Luke, an attorney, is living with his new girlfriend, Isabel Kelly, a successful fashion photographer several years his junior. Isabel tries hard to make Anna and Ben feel comfortable and happy with her, but Anna repeatedly rejects her overtures while Ben, who is generally kind to Isabel, adds extra complication with his mischievous nature. Isabel behaves with contempt tempered by caution around Jackie, believing she overcompensates for her divorce by spoiling her children.
Jackie, a former publisher turned stay-at-home mom, gives Isabel a cold reception, seeing her as an overly ambitious career woman. She also continues to harbor malice towards Luke, as seen in a confrontation about Isabel. After a long string of arguments and hurt feelings involving Isabel, Jackie, and Anna, Luke proposes to Isabel, making her Anna and Ben's soon-to-be official stepmother. This causes even more friction. Jackie is diagnosed with lymphoma, which is discovered to be terminal. She experiences a range of negative emotions, angry at the woman who she feels was responsible for breaking up her family, and angry that after all of the sacrifices she made for her family, she will never see her children grow up. Jackie actively sabotages Isabel's effort to bond with the children even to the point of refusing to allow her to take Anna to see a rock band that she likes and then taking her to the same concert a few weeks later herself.
Luke and Jackie later tell the children about the engagement, and Anna is furious. Jackie tells Luke and the children about her illness, resulting in Anna storming out. That night Jackie shows that she can be fun by dancing and singing with Anna and Ben.
Isabel and Anna continue to clash. Isabel gets the children a golden retriever puppy, and Anna says that she is allergic to dogs. Surprised, Isabel apologizes and says that her father didn't tell her that. After another argument between the two, Anna takes the dog inside her room, indicating she lied about her allergy. Eventually, Isabel and Anna's relationship improves. They start to bond over painting, when Isabel teaches Anna how to paint trees.
Jackie and Isabel disagree repeatedly, largely over Isabel's parenting. Ben goes missing on Isabel's watch and Jackie claims that she has never lost him, which she later admits to be untrue. When Anna has problems with a boy she once liked, the two women give opposite advice, causing more tension between Jackie and Isabel. They manage to establish a shaky truce, as they come to terms that Isabel will soon step into the role of a surrogate mother. The two women finally bond when Isabel reveals her admiration of Jackie's maternal instincts, while Jackie in turn praises Isabel's hipness as a means to connect with Anna. Isabel finally lets her guard down when she tells Jackie her biggest fear is that on Anna's wedding day, all Anna will wish for is her mother's presence. Jackie says her own fear is that Anna will forget her. Jackie explains to Isabel that, while Jackie will always have their past, Isabel will have their future.
The film ends with the family celebrating Christmas. Jackie, who is bedridden, is visited in her room by Ben and Anna. Individually, Jackie tells her children that though she will die, she will remain with them as long as they remember her. Later that day, Isabel is taking a family portrait of Luke and Jackie with the children. Jackie demonstrates her acceptance of Isabel by inviting her to join them, stating "let's get a photo with the whole family". Isabel does, and as the closing credits begin, both women are shown happily in a photo side by side, finally at peace with one another and with future events ahead of them (Jackie's death and Isabel's marriage to Luke).