Captain Jed Kelton (Richard Arlen), Union Army officer, unfairly tried for cowardice in battle during the Civil War, escapes from custody while being transported to Fort Leavenport in Kansas. After a brief visit home, Jed and his grizzled old friend, Hap Shelby (George "Gabby" Hayes), go to Nevada Springs, Nevada, where Spud (Bobby Driscoll), the eight-year-old brother who idolizes Jed, is living with Sam Ballou (Robert Livingston), Jed's best friend in their early boyhood days, Jed finds that Sam is now owner of the Silver Queen saloon and dance hall. Sam is greedy for wealth and power, and not particular how he gets it, even at the expense of others. Chiquata McSweeney (Jane Frazee), beautiful singing star at the Silver Queen, and sweetheart of Sam, is sincerely fond of young Spud, but Jed thinks that a saloon is the wrong place to keep a child and he arranges for Spud to live at the home of Judy Parker (Lynne Roberts), the well-bred Sunday School teacher whose father, Adam Parker (Russell Simpson), is one of the upright and honest citizens that Sam is exploiting and ruining. Parker is the owner of the Big Bonanza mine. When Jed learns from Judy of the change in Sam's character, he takes up the cause of the miners and heads up the opposition to Sam. When one of Sam's henchmen kills Parker, Spud is an eye witness and is now a target to be eliminated.