Dakota Indian Agent Steve Reynolds receives a copy of the Bonanza City Nuggett from Jim Mallory and reads a story blaming the Durango Kid for recent gold mine raids. Steve, also the Durango Kid, and his pal Smiley head for Bonanza City to contact Mallory and Rance Hudson, his partner in the mining machinery business. Mallory sells his interest in the business to Hudson for $50,000 and heads for California. Seeing him off are Hudson's secretary Anne Parker, her father Sam Parker, owner of the Gold Moon Mine and his miners Hank Penny and the Plantation Boys (Harold Hensley, Noel Boggs, Sanford Williams and Fenton Reynolds). Hudson plans to rob the wagon train and blame the Durango Kid, and sends Curlew and his henchmen to do the job. Killing Mallory in the raid, Curlew caches the money rather than taking it to Hudson. Despite that, Hudson learns that Carter plans a gold shipment and orders Curlew to rob the stage. Steve and Smiley hit town and Steves decides that Curlew and his brother Red could bear watching. The Durango Kid breaks up the first robbery attempt, but a second one is successful, although Durango learns from a wounded henchman that the Curlew gang has a hideout in Lost Canyon.