In 1876, the three-year-old North West Mounted Police service struggles to keep the peace with a limited number of men. Among the Mounties' many problems is the Cree Indian tribe led by Standing Bear, who have deserted their Canadian reservation to cross the border into Montana and hunt American buffalo. Several of the Cree are killed by the American cavalry, whom they call "Long Knives," and in retaliation, the Cree engage in a fierce battle with the cavalry. The Indians are defeated, and despite the protests of hotheaded war chief Konah, Standing Bear orders the tribe to return to Canada. To ensure their safety, Standing Bear instructs Konah to capture white hostages, so Konah and his men kidnap Emerald Neeley after killing her father and brother. The Cree also capture the Neeleys' scout, Jess Calhoun, and the encounter is witnessed by half-breed trader Natayo Smith. Natayo decides to apprise the Mounties of the occurrence, and while Natayo is enroute, Constable Duncan MacDonald, who has only recently transferred to Ft. Walsh, reports to Inspector Frazer. Frazer is angered by Duncan's admission that he let his suspect escape, and when Natayo tells Frazer about the Cree and their captives, Frazer assigns Duncan to the case. Natayo reluctantly agrees to act as Duncan's scout, and during their journey, Natayo is terrified when he sees a mirage of a lake appearing in the distant mountains. Duncan explains the phenomenon, however, and calms him. Soon after, Natayo and Duncan are surrounded by a Cree scouting party and are taken to the tribe's camp. Although Natayo is nervous about the size of the tribe, Duncan explains his mission to Standing Bear, and his insights into the Cree's current situation convinces the chief that he has "powerful medicine." Duncan, who is called "Pony Soldier" by the Indians, requests that he be granted a council with the tribe's elders, then talks with Emerald and Jess while his request is considered. Emerald, who is delighted to see Duncan, is baffled by Jess's nervousness at the lawman's presence. Although the bigoted Jess wants to use force to escape, Duncan insists that only by reasoning with the Indians will they be freed. Duncan then waits with Natayo and befriends an orphaned young boy named Comes Running. The boy tells Duncan that when two tribes make peace, it is customary for them to adopt sons from each other's peoples, and Natayo warns Duncan that Comes Running wants to be adopted by him. Their discussion is interrupted by an announcement that Konah has given Emerald to his brother Shemawgun as a wife, and the next day, when Duncan protests the arrangement, Standing Bear informs him that his request for a council meeting has been denied. Realizing that he has been defeated, Duncan is searching for another plan when a mirage of a steamboat appears on the horizon. Capitalizing on the Indians' fear, Duncan explains that the Great White Queen of Canada has sent this vision to express her anger with them. The elders agree to the council, during which Duncan promises that the Mounties will enforce the same laws for Indians and white people, and that the Indians will not go hungry if they return home. Standing Bear agrees to return and to free the captives, which enrages Konah. After the meeting, Duncan agrees to adopt Comes Running and renames him Duncan Comes Running MacDonald. Seeing Natayo and Jess exchange an uncomfortable glance, Duncan asks Natayo about the captive, and Natayo reveals that Jess's real name is Johnny Pierce, and that he is a convicted bank robber who escaped from a Winnipeg jail. Duncan then goes to the captives' tent and there sees Shemawgun, who asserts that he still intends to claim Emerald as his bride. The next morning, when Shemawgun comes for Emerald, Jess kills him during a fierce fight. Jess is captured by the tribe as he tries to escape, and Konah prepares to execute him. Duncan insists that Jess be turned over to the proper authorities, and Standing Bear, believing that Duncan will insure that Jess is punished, orders Konah to release Jess. Jess then attempts to escape, but Duncan stops him by shooting him in the shoulder. While Duncan and Standing Bear discuss the upcoming march back to Canada, Konah and his men kidnap Emerald. The chief and the pony soldier join forces to find the renegades, and are followed by Comes Running. Believing that Emerald has brought "bad medicine" to the tribe, Konah prepares to burn her alive, but Standing Bear and Duncan arrive in time to save her. The pair triumph over the warriors, and Comes Running kills Konah with an arrow just as he is about to shoot Duncan. With their problems solved, Standing Bear and Duncan lead the tribe back to Canada, and Comes Running proudly rides beside his new father.