A gold prospectors' camp at the foothills in California during the Gold Rush.
Dusk. In the Polka saloon, things are getting lively: the miners are assembling after their day's work. They are playing cards, exchanging news and ordering drinks and cigars. The bartender Nick is busy with his customers. The game stops when the local bard Jake Wallace sings a melancholy song and plunges everyone into nostalgia. Jim Larkens cannot stop crying; he is sick to the back teeth of this life and wants to go home. The lads all chip in to pay for his journey. Those playing cards discover a cheat and are ready to attack him. Sheriff Rance attaches a marked card to Sid's chest as a mark of shame and steers him out of the saloon. The Wells Fargo agent Ashby drops into the Polka and relates how his hunt for a band of Mexican bandits headed by Ramerrez is progressing. Meanwhile, a quarrel flares up between the sheriff and the prospector Sonora: both are claiming the favour of Minnie, the saloon's owner. A fight ensues. At the very height of the struggle, a revolver goes off – it is Minnie. The prospectors greet the beauty in delight. In order to atone for their guilt in what has happened, they bring her presents. The men gather around the girl for a lesson – to hear the Bible read.
The pony express arrives with letters. Ashby is delighted with a message he has received: Ramerrez' lover tells him where the bandit will be that night. The prospectors all read their letters from family, while Nick tells of a peculiar stranger outside who is asking for whiskey and soda. Left alone with Minnie, the sheriff hastens to pour out his feelings. He admits that he has never loved anyone, but that now he would surrender all his treasure for just one kiss from her. Minnie dreams of another life, and she remembers her parents. The appearance of the stranger who calls himself Dick Johnson (it is actually Ramerrez) interrupts their conversation. The stranger recognises in Minnie the girl he once met on the road to Monterey. Neither has she forgotten him. Rance is filled with suspicion, and he jealously watches Minnie dancing with the stranger.
A noise is heard outside. Ramerrez' accomplice José Castro has been caught. He promises to take the sheriff to the bandit's lair, and secretly tells Johnson that the band is prepared, they just have to wait until there is no-one left in the saloon. A storm begins, but the sheriff and the gold prospectors nevertheless intend to catch the bandit. Minnie is happy that this new friend will stay with her in the empty saloon. She admits to him that the prospectors store the gold they have found there. "I'm just a poor girl," Minnie laments about her lack of education, and says that she dreams of being as erudite as her interlocutor. She tells of the hard labour of the gold prospectors, of their woes and of the families they have left behind. Johnson abandons his criminal plans: he cannot rob a girl he has loved. He must leave, and Dick asks permission to accompany her home.
In Minnie's hut her helper, Wowkle the Red Indian, is discussing the forthcoming wedding with her friend Billy Jackrabbit, which will take place at the insistence of her mistress.
Minnie orders Wowkle to set the table for two, herself hurrying to doll herself up: today there will be a guest in the house. A snowstorm can be seen outside the window. Johnson arrives. There is the joy of their meeting and Minnie's first kiss. Dick cannot reveal the truth about himself and wants to go, but the girl makes him stay. He must stay the night, and wait for the bad weather to pass. Suddenly voices can be heard outside. It is Rance, Nick, Sonora and Ashby; they have followed Ramerrez' trail here. Dick listens from his place of concealment and hears them telling Minnie that Johnson and Ramerrez are the same man and that he was revealed to them by his lover Nina Micheltorena. The girl is stunned by this news. Nick notes the presence of a guest in the house, but does not voice his suspicions. The men leave with nothing.
Minnie is insulted and hurt: she has chosen a bandit for a lover and has been deceived. Johnson begs her to hear his story. After his father's death he truly had to become a bandit to feed his family. Meeting Minnie has let him dream of peaceful happiness, but now all is finished. The girl is ready to forgive the bandit, but not to forgive a man who stole her first kiss through deception. She shows him the door. A shot is heard.
Minnie hurries to help her beloved, and before the sheriff arrives she manages to conceal Dick in the attic. To Rance, who has come for his prey, the girl declares resolutely that she is alone. Rance prepares to leave when suddenly a spot of blood drips down from the attic. Seized with fury, the sheriff forces the wounded man downstairs. Johnson loses consciousness. Minnie resorts to a trick in despair: she asks Rance, a confirmed gambler, a game of poker. If he wins, he will get her and Johnson, and if she wins Dick will remain with her. At the decisive moment, the girl cheats at cards. Rance leaves, concealing his thirst for revenge. Minnie rushes to Dick.
Rance and Nick are sad, awaiting news of Ramerrez' capture. Nick consoles the sheriff, telling him of his noble act concerning Minnie. She tended to Ramerrez, and he is again on the run. Shouts of the pursuers can be heard. Ashby rubs his hands: this time the criminal will not get away. The sheriff looks forward to his revenge. Ultimately, it is Sonora who succeeds in capturing the fugitive. The men dance joyfully: now they will have justice. Nick secretly warns Billy Jackrabbit who is preparing a noose not to hurry in hanging Ramerrez. The criminal listens to the accusation before the crowd. His is given a chance to speak, and Dick asks for Minnie not to be told of his involvement: let the girl believe that he has chosen the path of correction and has gone far away. The girl tenderly turns to the prospectors, convincing them that the bandit Ramerrez was is dead, that there is not a sinner in the world to whom the path to redemption would not be open. She reminds her customers how she has cared for them. Speaking for all, Sonora grants the criminal his life and freedom. Minnie and Johnson bid farewell to the brothers and California.