It is Christmas Eve, and a humble prospector has spent his last cent for food. He is heartbroken to think that he cannot even buy anything for his two small children. When his wife finds a letter to Santa Claus asking for a doll and rocking horse, the prospector is desperate. He goes out and steals Broncho Billy's horse, sells it and spends the money for toys. The youngsters are delighted and the father forgets the theft. Broncho learns who stole his horse and goes to the prospector's home with a posse to hang him. When Broncho sees how the money was spent, his heart is touched. Each member of the posse then contributes some money and they leave the family happy.