On Romulus members of the Romulan Imperial Senate debate whether or not to accept the terms of peace and alliance with the Reman rebel leader Shinzon. The Remans are a slave race of the Romulan Empire, used as miners and cannon fodder. A faction of the military is in support of Shinzon, but the Praetor and senate are set against it. After rejecting the motion, the Praetor and remaining senators are disintegrated by a device left in the room by a military-aligned senator.
Meanwhile, the crew of the USS Enterprise-E prepares to bid farewell to first officer Commander William Riker and Counselor Deanna Troi, who are being married on Betazed. En route, they discover a positronic energy reading on a planet in the Kolaran system near the Romulan Neutral Zone. Captain Jean-Luc Picard, Lieutenant Commander Worf, and Lieutenant Commander Data land on Kolarus III and discover the remnants of an android resembling Data. When the android is reassembled it introduces itself as B-4. The crew deduce it to be a less-advanced, earlier version of Data.
Picard is contacted by Vice Admiral Kathryn Janeway and orders the ship on a diplomatic mission to nearby Romulus. Janeway explains that the Romulan Empire has been taken over in a military coup by Shinzon, who says he wants peace with the Federation and to bring freedom to Remus. On arrival, they learn Shinzon is a clone of Picard, secretly created by Romulans to plant a high ranking spy into the Federation, but the project was abandoned and Shinzon left on Remus as a child to die as a slave. After many years, Shinzon became a leader of the Remans, and constructed his heavily armed flagship, the Scimitar. Initially, diplomatic efforts go well, but the Enterprise crew discover the Scimitar is producing low levels of thalaron radiation, which had been used to kill the Imperial Senate and is deadly to nearly all life forms. There are also unexpected attempts to communicate with the Enterprise computers, and Shinzon himself violates Troi's mind through the telepathy of his Reman viceroy.
Dr. Crusher discovers that Shinzon is aging rapidly due to being a clone and the only possible means to stop it is a transfusion of Picard's own blood. Shinzon kidnaps Picard from the Enterprise, as well as B-4, having planted the android on the nearby planet to lure Picard to Romulus. However, Data reveals he has swapped places with B-4, rescues Picard, and returns to the Enterprise. They have now seen enough of the Scimitar to know that Shinzon plans to use the warship to invade the Federation using its thalaron radiation generator as a weapon, with the eradication of all life on Earth being his first priority.
The Enterprise races back to Federation space but is ambushed by the Scimitar in the Bassen Rift, which prevents any subspace communications. Two Romulan Warbirds come to the Enterprise's aid, as they do not want to be complicit in Shinzon's genocidal plans, but Shinzon destroys one and disables the other. Recognizing the need to stop the Scimitar at all costs, Picard orders the Enterprise to ram the other ship. The collision leaves both ships heavily damaged and destroys the Scimitar's primary weapons. To assure their mutual destruction, Shinzon activates the thalaron weapon. Picard boards the Scimitar to face Shinzon alone, and eventually kills him by impaling him on a metal strut. Data jumps the distance between the two ships with a personal transporter to beam Picard back to the Enterprise, and then fires his phaser on the thalaron generator, which destroys the Scimitar and Data while saving the Enterprise. The crew mourns Data and the surviving Romulan commander offers them her gratitude for saving the Empire.
The Enterprise returns to Earth for repairs. Picard bids farewell to newly promoted Captain Riker, who is off to command the USS Titan, to begin a possible peace-negotiation mission with the Romulans. Picard meets with B-4, discovering that Data had copied the engrams of his neural net into B-4's positronic matrix before he died. Though B-4 does not yet act as Data, Picard is assured that he will become like his friend in time.

Question: Where is the Enterprise ambushed by the Scimitar?
Answer: In Federation space.