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After Gene Autry's friend, Ed Norton, is killed during a dice game, Gene goes in search of the killer. He comes across an old house where Larry Evans, who has been accused of the murder, is in hiding, aided by his sister Mary. Mary defends her brother, stating that they both loved Ed, who acted as their guardian after the death of their father. Gene becomes convinced that Larry is innocent and offers to help him evade the sheriff until he can discover the real killer. Gene learns that although Ed was shot with Larry's gun, Larry had earlier offered it as collateral for a bet, and that anyone could have shot Ed when the lights in the room went out. After a posse spots Larry with Gene, Gene hides him in a cabin belonging to his friend, Jim Hedge, a prospector. When Gene questions him, Larry says that either Dave Randall or Don Mason, who were both playing in the card game, suggested that he put up the gun. Gene then rides into town. Meanwhile, Mason offers to buy the Evans ranch from Mary and help Larry escape over the border. Gene overhears the conversation and is surprised by the large amount Mason proposes to pay for the property. The sheriff follows Gene from town, and although Gene manages to warn Larry of the lawman's presence, Larry is convinced that Gene has betrayed him. The next morning Gene rides to the ranch with Jim. Larry is waiting, and after a struggle, realizes that Gene is on his side. Just as Gene notices that Jim's compass is behaving strangely, the sheriff arrests Larry. Gene then sets a trap for the killers and exposes Mason, who is in league with ranchers Bill Otis and Randall, who want to obtain a rich lode of iron ore on the ranch. Now that Larry's name is cleared, he and his sister will be wealthy.