During World War I, off the New England coast, German submarines prey on United States shipping vessels and are in turn hunted down by the subchasers of the splinter fleet. Operating in these hostile waters are John Thorson, a rowdy tugboat skipper, and his business competitor, Rocky Blake, an equally foul-tempered skipper. Thorson and his daughter Susan contrive to eliminate their competitor by tricking Rocky into joining the Navy, but when Thorson's beloved tug is sunk by a German U-Boat, he becomes so enraged that he also enlists in the Navy, determined to wage a one man war on the subs. Outspoken and undisciplined, Thorson disobeys orders and takes a subchaser out of formation to start his own hunt for the U-Boats. For his insubordination, Thorson is court-martialled, found guilty, demoted from ensign to ordinary seaman, and then assigned to land duty. He is about to desert when Rocky, now a subchaser division chief, is assigned to command a mystery schooner to decoy the subs and enlists Thorson in his crew. While attempting to ram the U-Boat that sunk his tug, Thorson is captured by the crippled sub, a target of the splinter fleet's depth charges. Miraculously, Thorson manages to signal the location of the sub, and when it is forced to the surface by the sub chasers, he is rescued. For his heroic actions, Thorson is decorated and reinstated to his former rank of ensign. After bidding Susan farewell, Rocky, Thorson and the fleet set sail for France.