Colonel Parker is the proprietor of a stagecoach line that has suffered repeated robberies, and one day, during another attack on one of his coaches, his son Ted is killed. Parker is upset but determined to carry the mail to the next stop, much to the dismay of his daughter Hazel, who abhors his pride. One of the passengers, rancher Martha "The Duchess" Wentworth, however, assures Hazel that her nephew, Red Ryder, can ease the Parkers' problems. The Duchess writes a letter requesting Red's help, but hotel clerk Ernest Murphy, who is the secret leader of the gang, takes it instead to Chopin, his psychopathic henchman. Chopin, who has a habit of playing "Oh! Susanna" on his harmonica, advises Murphy to send the letter, and then ambush Red and his Indian ward, Little Beaver, outside the town limits. Red and Little Beaver are to be replaced by The Idaho Kid, a notorious outlaw who is the brother of gang member Felton, and another Indian boy. Disguised as Red, Idaho is then to go to work for Parker and help the gang steal more shipments. Murphy approves of the plan, but as Red and Little Beaver are riding to town, Red kills The Idaho Kid during his ambush attempt. After Broken Arrow, an Indian boy who was kidnapped by Idaho, explains the situation, Red and Little Beaver continue into town. Meanwhile, Chopin, unaware of Idaho's defeat, tells The Duchess that Red is dead and threatens to murder Little Beaver if she reveals their scheme. Devastated, The Duchess returns to the hotel, where she is greeted by Red. Red warns her to act as if he is Idaho, and she hides her joy upon learning that Little Beaver is safe. Murphy and Chopin, who do not know what Idaho looks like, believe Red's act and send him a note to stay away from the next day's intended stage robbery so that he will not be suspected. Red, who signs on as a driver for Parker, foils the robbery, and when the irate Chopin complains to Murphy, Felton, who is also in the office, spots Red and states that he is not Idaho. Murphy realizes that Red is trying to infiltrate the gang and orders Felton to tell the sheriff that Red is Idaho. Meanwhile, Red arranges to drive a large shipment of gold and Murphy and Chopin kidnap The Duchess so that she will not be able to tell the sheriff the truth. Felton alerts the sheriff and Parker that Red is his outlaw brother, and Parker declares that he has been double-crossed, for Red is now driving the gold wagon. When Chopin and his men attack the wagon, they steal the gold and knock Red unconscious. The sheriff's posse soon comes upon Red, but Little Beaver helps him escape after he is arrested. Red and Little Beaver then follow Felton to the gang's hideout, where The Duchess is being held captive. While Little Beaver gets the posse, Red engages the gang in a fight. Murphy accidentally shoots Chopin while trying to kill Red, and Red is forced to shoot Murphy in self-defense. The rest of the gang is rounded up, and soon after, Parker thanks Red for his help.