In one of the film's funniest sequences, he hijacks the field trip bus and escapes with his fellow inmates for a wild fishing field trip. On the way, he picks up a prostitute friend named Candy (Marya Small) at the Riverside Trailer Court, who innocently asks all the "boys":

You all crazy?

In a memorable scene in which McMurphy flaunts his disobedience, McMurphy convinces the charter boat harbor manager (Mel Lambert) that the men are a group of doctors from the state mental institution. He introduces each one of them: "This is Dr. Cheswick, Dr. Taber, Dr. Frederickson, Dr. Scanlon, the famous Dr. Scanlon, Mr. Harding, Dr. Bibbit, Dr. Martini, and Dr. Sefelt (William Duell)...Oh, I'm Dr. McMurphy, R. P. McMurphy." On the trip to catch fish, he tells Martini:

You're not an idiot. Huh! You're not a goddamn looney now, boy. You're a fisherman!

Although the group is jubilant during the liberating trip, the boat actually spins in circles on the open water when Cheswick takes the wheel. While they fish, McMurphy ventures below deck with Candy. The inmates even come back with a full catch of fish and smiles on their faces - their holiday away from the hospital has done them more good than a therapy session. They are greeted at dockside by the police and Dr. Spivey.

In a meeting in Dr. Spivey's office, the institution's doctors agree that McMurphy is "dangerous" and possibly a threat to society, but probably not insane. Nurse Ratched wants to keep McMurphy in the hospital, not to "help him" but because she is determined to control him and break him:

Dr. Spivey: The funny thing is that the person that he's the closest to is the one he dislikes the most...That's you, Mildred. (He gestures toward Nurse Ratched)
Nurse: Well gentlemen, my opinion, if we send him back to Pendleton or we send him up to 'Disturbed,' it's just one more way of passing on our problems to somebody else. You know, we don't like to do that. So I'd like to keep him on the ward. I think we can help him.

McMurphy's lessons on basketball are effective, and he is able to successfully coach and organize games with the patients and guards. With his statuesque height, Chief Bromden steals the show, standing at one end of the court with hands held high in the air to dunk baskets, and disallowing baskets at the opponents' end of the court. After learning that he won't be released in 68 days from the hospital to the "outside," as he would if he was at the prison farm, McMurphy asks Nurse Ratched and the other patients about his indeterminate length of stay:

I'd like to know why none of the guys never told me that you, Miss Ratched, and the doctors could keep me here 'til you're good and ready to turn me loose. That's what I'd like to know.

He realizes that most of the patients are voluntary and self-committed, and have the freedom to leave at any time if they choose: "As a matter of fact, there are very few men here who are committed - there's Mr. Bromden, Mr. Taber, some of the chronics, and you." The inmates are not crazy at all - merely helpless misfits in the outside world, and accepting of their fate in the walls of the institution. McMurphy is amazed that Billy is only voluntary:

You're just a young kid. What are you doin' here? You oughta be out in a convertible, why...bird-doggin' chicks and bangin' beaver. What are ya doin' here, for Christ's sake? What's funny about that? Jesus, I mean, you guys do nothin' but complain about how you can't stand it in this place here and then you haven't got the guts just to walk out!

To all of the inmates, he tells them that they are no more insane than the Nurse or any of the asylum wardens:

McMurphy: What do you think you are, for Christ's sake, crazy or something? Well, you're not! You're not! You're no crazier than the average asshole out walking around on the streets and that's it!
Nurse: Those are very challenging observations you made, Randall.

Inspired by McMurphy's instigating, "challenging observations," the patients begin to use their minds and express their feelings, questioning the authoritarian Nurse and the system that keeps them locked up. However, the therapy session degenerates when the patients end up fighting with each other over cigarettes (traded as currency). The Nurse closes down McMurphy's "gambling casino" operation in the tub room - she also suspends their tub privileges and rations their cigarettes from her office. The scene ends when Taber screams about his burning pantleg and Cheswick shouts at the Nurse in an overacted temper tantrum:

RULES? PISS ON YOUR F--KING RULES, MISS RATCHED!...I WANT YOU TO KNOW SOMETHING RIGHT HERE AND NOW, MISS RATCHED. I'M NO LITTLE KID!...I AIN'T NO LITTLE KID! WHERE ARE YOU GOING TO HAVE CIGARETTES KEPT FOR ME, LIKE COOKIES, AND I WANT SOMETHING DONE!

McMurphy smashes his fist through the glass panels of the Nurses' Station and seizes a carton of cigarettes for Cheswick. When Washington (Nathan George), a black guard, tries to restrain him, they get into a vicious wrestling match and fist-fight. The Chief enters the struggle to help even the odds.

As punishment, Cheswick, McMurphy, and Chief Bromden are shackled and sent upstairs to the 'Disturbed' ward to receive electro-shock treatments. There while waiting on a bench, McMurphy realizes, to his shocked surprise (after giving the Chief a piece of Juicy Fruit chewing gum) that Bromden, like himself, has faked being deaf and dumb to close himself off from a hypocritical society. They plan an escape together:

McMurphy: You fooled 'em, Chief! You fooled 'em. You fooled 'em all. Goddamn. What are we doin' here Chief? Huh? What's us two guys doin' in this f--kin' place? Let's get out of here. Out!
Chief: Canada.
McMurphy: Canada. I'll be there before these son-of-a-bitches know what hit 'em. Listen to Randall on this one.

Later after his treatment, McMurphy walks zombie-like into a therapy session in progress on the ward, and the inmates respond affectionately to his return as he sparks them back to life:

How about it? You creeps, you lunatics, mental defectives. Let's hear it for Bull Goose Randall back in action...You ding-a-lings. The Mental Defective League, in formation.

He jokes to Billy about the effectiveness of shock treatments that he received:

They uh, was givin' me ten thousand watts a day, you know, and I'm hot to trot. The next woman takes me out is gonna light up like a pinball machine, and pay off in silver dollars.

The patients mindlessly watch a TV news broadcast where an announcer speaks about the "possible opening of the Berlin Wall during the upcoming Christmas holidays." [The obvious parallels are drawn between their own walled-in imprisonment and their powerlessness.] Another news story, heard in the background, describes the arrest of three men (on a misdemeanor charge) who were allegedly involved with the dynamite bombing of a church in Birmingham, Alabama that killed three innocent Negro children while they were attending services. [This event prefaces the similar deadly fate of innocent, child-like Billy Bibbit in the film's next scene.]

McMurphy's last bold victory overextends his reach, when he plans a pre-escape party with alcohol and prostitutes. After bribing the night watchman Turkle (Scatman Crothers) with booze, he smuggles two girlfriends, Candy and Rose (Louisa Moritz) into the ward late at night for a wild drinking party after the Nurse has left. Although the patients enjoy themselves, the entire ward is quickly destroyed. McMurphy has an opportunity to leave, but hesitates when young Billy Bibbit expresses disappointment at the departure of his friend - and then wishes a last-minute "date" with Candy. McMurphy thinks to himself:

Jesus, I must be crazy to be in a loony-bin like this.

McMurphy persuades Candy to sleep with Billy so that he can experience life's fruits and lose his virginity: "All you gotta do is this one little thing. The kid's cute, isn't he?" Billy is delivered in a wheelchair to Candy by the other patients. To encourage him, McMurphy challenges him: "Billy, I got twenty-five dollars that says you wanna burn this woman down."

The next morning, the ward orderlies find the place in a shambles. McMurphy has drunkenly fallen asleep on the floor. The crash of the ward's locked gate as it closes alerts McMurphy to the Nurse's arrival. Nurse Pilbow discovers Billy Bibbit in bed with Candy in one of the rooms. The patients applaud his conquest when he joins them in the ward, smiling from ear to ear. But Billy is forced to "explain everything," and made to feel guilty about experiencing and enjoying sex:

Nurse Ratched: Aren't you ashamed?
Billy: (without stuttering) No, I'm not. (More applause)
Nurse: You know Billy, what worries me is how your mother's going to take this.

Threatening to inform his mother about his behavior, thereby emasculating him, the repressive Nurse knows how to exploit Billy's weaknesses and torment him. There are disastrous results - Billy begins stammering again and feels so guilty and self-hating that he commits suicide by slitting his own throat. McMurphy is unable to make a quick break for it through the window in time but might have escaped to freedom during the confusion. But he goes beserk beyond control when he learns of Billy's death, feeling personally responsible for his new-found friend. When the Nurse authoritatively instructs everyone to "calm down" and "go on with our daily routine," he attempts to strangle her for having cruelly contributed to Billy's suicide. He locks his hands around her throat.

In retaliation, McMurphy is restrained and led away. Rumors spread that he has escaped, or that he has been brought upstairs and is "as meek as a lamb." In the middle of the night, McMurphy is returned to the ward - lobotomized, glassy-eyed, catatonic, totally passive, and obediently captive.

In the film's conclusion, inmate Chief Bromden realizes that "Mac" has had surgery on his brain. [A frontal lobotomy is the surgical severance of nerve fibers connecting the frontal lobes to the thalamus, a severe procedure commonly practiced in the 1930s-1950s on mentally-disordered patients.] He knows that McMurphy has lost his vital vigor and will never be able to escape with him to Canada. He hugs his friend and then ends his misery to free him from the bondage of his existence in an act of mercy killing. Bromden smothers and suffocates McMurphy with a pillow. Then, with his tremendous strength and inspired by McMurphy's liberating example, proving that a single person can still overcome oppressive conditions, he picks up the marble wash station from the tub room and smashes through the window with it. He escapes from the cuckoo's nest, flying away to the outer world - yet the world's horizon is both threatening and liberating. The other inmates remain incarcerated in the locked ward of the hospital after everything that has transpired.

[Note: In the novel unlike the film, the inmates courageously leave the hospital for new lives in the outside world.]