Based on the saga by Walter Noble Burns, the infamous killer fights for ranchers against the local tyrant's men.
A preface by the current New Mexico governor praises Billy the Kid's sense of justice. William Donovan (James A. Marcus) tells John Tunston (Wyndham Standing) and Angus McSween (Russell Simpson) that he is the law. Donovan has his men shoot a couple after taking their cattle and property "for taxes." Tunston holds a meeting and accuses a man of stealing, who pulls his guns and is killed by Billy the Kid Bonney (Johnny Mack Brown). Tunston's fiancé Claire Randall (Kay Johnson) arrives and meets the workers. Billy goes out, and the dead man's brother Grant is killed. Donovan asks sheriff Pat Garrett (Wallace Beery) who did it. Donovan sends Bob Ballinger (Warner P. Richmond), who tells Billy he has a warrant for Tunston. Ballinger's men shoot Tunston and ride off. Billy vows to kill them all. Billy goes into the saloon and kills two men who boasted of killing Tunston.
Pat Garrett asks Mrs. McSween to help him arrest McSween. Billy and men protect him. Billy kills one of the posse. Mrs. Hatfield comes in with a white flag and leaves with Mrs. McSween and Claire. After three days Billy and the men need water. Tom runs for water, is shot, and dies. Garrett asks Billy to give up McSween, or Donovan's men will burn them out. McSween goes out and is killed. Garrett tells Ballinger to stop but is shot in the arm. They roll barrels of fire down on the house. Billy and the men suffer smoke as fire spreads. The men rush out; some are shot, and some escape. Billy comes out last shooting and escapes.
The army arrives, and military governor General Wallace asks Claire to persuade Billy to accept a general amnesty that he also offers to Ballinger, as 28 men are already dead. Billy blames Donovan and says Ballinger murdered. Garrett says he will come after Billy, who is starved out at a cave. Garrett cooks bacon near him, and Billy gives up. A crowd gathers as Garrett brings in Billy. Claire kisses him. Ballinger tells Billy he will hang. Garrett and Billy play cards, and Billy takes his gun. Billy kills Ballinger and rides off still shackled. Claire finds Billy and asks to go with him. Billy says no and escapes from Garrett. Garrett lets Claire take his horse to join Billy across the border. (In the European version Garrett kills Billy as in history.)
This early version of the violent legend includes some comic characters and bears only occasional resemblance to the controversial life of the young man who killed men in revenge for the murder of his employers Tunston and later McSween.