Just before the start of the Civil War, six-year-old bootblack Spanky has to jump off a Mississippi River boat when his new little pal Buckwheat paints some of the passengers' shoes white to drum up business. Buckwheat, who is afraid he'll be shot as a runaway slave, soon follows, and the boys make their way to shore, then look food. Marshall Vallent, a kind man who had befriended Spanky on the boat, is against any war with the North, and is called a traitor by his friends. When Marshall encounters Spanky on shore, the boy convinces him that even though he is against war, he must stand by his friends. In gratitude for Spanky's advice, Marshall invites the boy to live with him and takes in Buckwheat as well, when he finds the hungry boy hiding under the dinner table. Some time later, the war between the North and South begins and Marshall, who has become a confederate officer, leaves Spanky in charge at home, and asks him to take special care of Marshall's sweetheart Louella, the daughter of elderly Colonel Blanchard. While the men are at war, Spanky, Buckwheat and their friend Alfalfa join other children in building a fort to protect the town. When some Yankee soldiers think that the fort is real, they fire upon it and make fools of themselves in front of their general when he arrives in time to see the "rebels" surrender. The bemused general commends the little soldiers for their bravery and calls Spanky "General Spanky." He then leaves the town in the care of Captain Simmons, who forcibly makes his headquarters in the Blanchard house. Meanwhile, Marshall has been wounded nearby and drags himself back to town where he is found by Spanky and his dog. They hide Marshall in their secret cave and summon Louella to help, but a suspicious Simmons follows Buckwheat to the cave and arrests Marshall. At a court-martial, Marshall is convicted as a spy and condemned to death, even though some members of the court think that the evidence is flimsy. When Marshall is sentenced to be shot, Spanky gets the idea to visit the Yankee general and ask for his help, as one general to another. After hearing Spanky's story, the Yankee general accompanies Spanky back to town, re-opens Marshall's court-martial, apologizes to Colonel Blanchard for Simmons' behavior, then has Simmons arrested. The general then arranges for Marshall to be included in an exchange of Northern and Southern prisoners of war if Marshall promises to return to civilian life. Finally, as a reward for his actions, the Yankee general is given an honorable induction into the children's army.