In the most memorable sequence of the film, a montage accompanied by the rousing song "Gonna Fly" (by Bill Conti), Rocky undergoes further grueling training and workouts. At dawn, he sprints beneath an overhead train, makes another run through the City of Brotherly Love's streets and marketplaces, punches a bag, does one-armed pushups, takes punches to his mid-section, executes endless situps, pounds more slabs of beef, and sprints along the city's waterway. He dashes (and flies) up the endless steps of the Philadelphia Museum of Art, taking many steps with each leap. He turns and faces the panorama of the city, with his hands triumphantly raised in the air. Although his first run up the endless steps was overwhelmingly difficult, this run is effortless. The cover story "Italian Stallion" in TEMPO Magazine (red-bordered like Time Magazine) displays his fighting stance.

The night before the fight, Rocky visits the deserted Philadelphia Spectrum, the setting for the Bicentennial bout. He climbs up into the ring, lined with thick red ropes, and stares at the two gigantic posters of the combatants facing each other at opposite ends. The arena is lined with red, white, and blue decorations and an American flag to accentuate the patriotic theme. Jergens is surprised to see him, especially when Rocky notes the inaccuracy of the color of his trunks (red pants with a white stripe) on his poster. His remark about the detailed oversight is ignored by Jergens - Rocky isn't taken seriously:

Rocky: Mr. Jergens, the poster's wrong.
Jergens: What do ya mean?
Rocky: Well, I'm wearin' white pants with a red stripe.
Jergens: It doesn't really matter, does it? I'm sure you're gonna give us a great show. Try to get some rest, kid.

Back with Adrian in his apartment, he sits on the edge of the bed and then lies next to her. With jitters, doubts and misgivings, he confesses to her that he can't win and beat Apollo, but then explains his ultimate goals for the fight - to go the distance to prove that he isn't just a "bum from the neighborhood":

Who am I kiddin'? I ain't even in the guy's league...It don't matter, 'cause I was nobody before...I was nobody. That don't matter either, ya know...It really don't matter if I lose this fight. It really don't matter if this guy opens my head, either. 'Cause all I wanna do is go the distance. Nobody's ever gone the distance with Creed. And if I can go that distance, ya see, and that bell rings, ya know, and I'm still standin', I'm gonna know for the first time in my life, ya see, that I weren't just another bum from the neighborhood.

January 1, 1976

The night of the big fight arrives. Rocky's left hand is wrapped in tape in the locker room, as Adrian looks on. Preparations are also being made in Creed's dressing room. Vaseline is applied under the eyes. Nasal drops are sprayed into the fighters' nostrils to enhance their oxygen intake. Wearing a bright red robe with yellow hood and lining (and emblazoned on the back ITALIAN STALLION), Rocky kneels to pray in the bathroom. When it is time to enter the arena, Adrian promises to wait in the locker room for him. Rocky jokes that she shouldn't leave town while he's gone, and then asks: "Wish me luck, I'm gonna need it."

One of the ring commentators speaks to the camera: "The electricity is all over the place tonight as Rocky Balboa....could be 'The Caveman against the Cavalier'." As Rocky moves toward the ring, Mickey asks him about the name of Paulie's meat-packing plant (Shamrock Meats, Inc.) sewn on the back of his robe, and Rocky responds: "Paulie gets three grand, I get the robe." As Rocky enters the arena, Paulie in the audience complains to him about the costly $200 baggy robe. The announcer describes Rocky's dismal chances as he approaches closer to the ring: "A fifty-to-one underdog living a Cinderella story, but he's captured people's imaginations all over the world...And his record 44 victories - he's had 38 by knock-out, and he's lost 20 bouts." Speculation and Las Vegas odds say he hasn't the "stamina and the skill" to last more than three rounds.

The world heavyweight, show-boating champion Creed enters the Bicentennially-decorated ring with tremendous fanfare, dressed up in a George Washington wig and period costume and riding in a boat - supposedly impersonating the famous President who crossed the Delaware. Another of Creed's silly ideas is to toss silver dollars to the crowd. Once inside the ring, he reveals an Uncle Sam outfit while pointing and gesturing to the crowd and Rocky: "I Want You!" - a mockery of the famous US recruiting poster for WWI. "I want the Stallion," he taunts as he predicts finishing the bout in three rounds. With Bill Conti's trumpeted theme song, a microphone descends into the center of the ring for announcements from Jergens. Gazzo sits in the crowd with a blonde next to him, and Paulie also has a pretty date (Kathleen Parker) holding his arm at ringside. Former heavyweight "Smoking Joe" Frazier (Himself) is brought into the ring, where he advises Rocky: "Don't hurt him, OK? Go light on him." He also play-boxes with Creed, revealing that they're "friends." Introductions are made for the main event:

• "the challenger wearing white trunks, weighing one hundred and ninety pounds, Philadelphia's favorite son, 'The Italian Stallion,' Rocky Balboa"
• "wearing red, white, and blue, weighing two hundred and ten pounds, undefeated in forty-six fights, the 'Master of Disaster,' the undisputed Heavyweight Champion of the World, Apollo Creed"

After the referee covers the rules in the center of the ring, the much-anticipated bout begins. Determined, Rocky proves his worth in the ring for the title fight, in the fast-paced, highly-choreographed, exciting boxing match. In round one, Creed dances around and executes quick jabs at the slower challenger. The commentator notes that "Rocky was blocking the blows with his face." The Champion smiles and "toys" with his "outclassed" opponent until he is knocked flat to the canvas by a tremendous, upswinging, crushing left hook to Creed's jaw - his legendary southpaw punch. The disbelieving Champion is up after a standing count, but he would have been defeated if Rocky had immediately proceeded to his neutral corner. For the remainder of the round, the Champion fights more effectively by delivering multiple punches, but so does Rocky as he pounds combinations into Creed's mid-section and electrifies the crowd. Just before the bell rings, Creed breaks Rocky's nose.

In Rocky's corner, Mickey notes: "Your nose is broke" but then quips: "Ah, it's an improvement." Mickey also tells Rocky: "Go for the ribs. Don't let that bastard breathe." Duke tells his man to quit playing around and showing off - it's not an exhibition match: "I wantcha to stick and move...He doesn't know it's a damn show. He thinks it's a damn fight. Now finish this bum and let's go home."

In the second round, both fighters deliver barrages of lightning-fast punches and jabs. Rocky doesn't give up, but concentrates on hitting Creed's body and pounding him with ferocious counter-punches. A series of quick montages dissolve from round to round in the match that goes for fifteen grueling, punishing rounds. From various long-shot and closeup angles, the sounds of gloves striking their targets are magnified with grunts, commentary from ringside, and crowd noises. With his face swelling and bloody, a stubborn Rocky falters but doesn't give up ("What is keeping him up?" asks a commentator), while the battered Creed is stunned that the challenger refuses to fall or acknowledge being beaten. In the 14th round, Rocky is sent to the canvas, but he crawls to his corner and manages to pull himself up with the ropes. Ignoring Mickey's pleading "Down! Down! Stay down!", he manages to pull himself up with the ropes. And with a new burst of tenacious energy, he pounds Creed's ribs and sides with body punches as the bell rings. For the first time, Adrian creeps into the arena and watches in painful dismay.

In Rocky's corner before the 15th and final round, the boxer begs Mickey to cut open his swollen eye so he can see ("Cut me"). In the champion's corner, Duke suggests stopping the fight, but Apollo refuses ("You ain't stoppin' nothin', man"). In a parallel shot, Rocky tells Mickey, "You stop this fight, I'll kill you!" In the middle of the ring, the two combatants circle around each other before unleashing more blows. Creed protects his right side and injured ribs until Rocky finds an opening and assaults his opponent's mid-section. As the bell rings, Creed appears unconscious on the ropes, but he survives the flurry of blows when time runs out. As they hang exhausted on each other, they barely have enough energy to speak:

Creed: Ain't gonna be no rematch.
Rocky: Don't want one.

Although he originally meant to go the distance, the self-respecting Rocky proves that he is more than a born loser and "another bum." Unable to see, he is surrounded by hordes of questioning reporters and interviewers, but he shows little concern about the fight's outcome. All he can do is shout for Adrian. His calls for her are drowned out by the eruptions from the crowd. Adrian calls back to Rocky as she struggles to reach ringside. She plunges headlong into the sea of people, as Jergens puts words to the monumental fight: "the greatest exhibition of guts and stamina in the history of the ring."

Rocky narrowly loses a split decision (the decision is difficult to hear, but it appears that two judges vote for the champ and one for Rocky) and the champ barely retains his title. Creed, who predicted an effortless victory, never could have expected the outcome. To provide perspective, the importance of the actual outcome of the fight is deliberately muted and in the background, emphasizing the profundity of the moral victory Rocky achieved by "going the distance" against overwhelming odds.

In the confusion following the fight, Adrian finally reaches Rocky - the real and true champion - in the ring, and she exclaims: "I love you." He lovingly hugs and embraces her and declares his own love for her: "I love you!" As they lovingly hug each other in a locking grip, they continue declaring their love for each other. As they celebrate their victory in the face of defeat, the final, heart-lifting image freeze-frames on Rocky's swollen, messy and battered face next to Adrian's.