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In 1930 New York, shortly after debt-ridden nightclub owner Rudy Martin dies, his daughter Elizabeth, whom he called "Queenie," shows up to hand the deed to his club to kindhearted bootlegger Dave the Dude. Attracted to Queenie, the Dude decides to help her turn the club into a popular speakeasy, and two years later she has paid off all of her father's debts. Everything is going right for the Dude, who thinks that his luck comes from his daily purchase of an apple from "Apple Annie," a disheveled old apple vendor who leads the Broadway panhandlers. He is about to make a deal with Chicago gangster Steve Darcey, and Queenie has agreed to marry him. Just as the Dude is about to close his deal with Darcey, however, his boys are unable to find Annie. Panicky that he won't have the luck he needs for pulling off the Darcey deal, the Dude learns where Annie is from a group of panhandlers who visit his apartment. They tell him that Annie has been supporting a daughter who has been living in a Spanish convent for years and that all of the extra money she has squeezed from them has gone to the girl. In an elaborate deception, Annie has been sending and receiving letters from the girl, named Louise, at the swank Marberry Hotel. When the hotel employee who had been Annie's contact was fired for apparently "stealing" one of the letters, Annie went boldly in and retreived it herself, only to discover that it announced Louise's imminent marriage and arrival in New York with her fianceé and his father, a Spanish count. When the Dude visits Annie, accompanied by Queenie, who has decided to leave the Dude and marry someone else if he closes the Darcey deal, she drunkenly confirms what has happened. Although he is sympathetic, he leaves with his apple, but after the panhandlers offer their meagre savings to finance a real stay for Annie at the Marberry and Queenie goads him into rethinking the matter, the Dude agrees to help. Using a rich friend's appartment at the Marberry, and with the aid of the kindly butler Hutching, the Dude installs Annie as a tenant. With Queenie's help, and that of several hairdressers, makeup artisits and clothiers, Annie is transformed into her elegant society alter ego, Mrs. E Worthington Manville. To complete the picture, Judge Henry Blake, a silver-throated pool hustler, is brought in to play her husband. When the boat arrives that night, the transformed Annie greets Louise, her fiancé Carlos and his father, Count Romero. Reporters on the dock are suspicious when they see the Dude and his gang there and try to get a story, but the Dude's boys Junior and Joy Boy arrange to have the reporters taken away. For the next several days, while the boys try to keep Darcey occupied, Annie and Louise's reunion proceeds joyfully, while the Dude gets swept up in the fairy tale. Despite Joy Boy's constant nagging that Darcey will tire of waiting for a final meeting and turn violent, the Dude cools his heals. Meanwhile, newspaper stories about the missing reporters have surfaced, and the entire city is up-in-arms. From the beat cops to the chief of police, the mayor and even the governor, everyone is being criticized in the press for inaction. As the day of Louise and the Romero's departure approaches, the marriage seems a certainty until Count Romero insists on meeting some of Mrs. Worthington's society freinds. Realizing that the marriage will not go through without some kind of reception, the Dude and Judge Blake tutor his gang on gentlemanly repartee and manners, while Queenie teaches her chours girl freinds how to hehave like "ladies." After intensive coaching, the group seems ready for their debut as society substitutes at the planned reception, but just as they are about to leave Queenie's club, some panhandlers let the Dude know that the police, suspicious that the Dude is involved in the reporters' kidnapping, have surrounded them. As Annie waits in despair and the Count becomes increasingly suspicious because no one has come to the reception, the Dude is questioned by the police commisioner. Unable to explain the situation to the commissioner's satisfaction, the Dude then admits that he has the reporters and promises to kill them unless he is taken to the mayor. While the Dude is being taken to the mayor, who also is having a reception that night, Annie decides that she has no choice but to tell the count the truth. Just as she is about to reveal everything, however, the Dude arrives, accompanied by the mayor, the governor and all of the society guests from the mayor's New Year's Eve reception. As each person greets Annie, they pretend to know her well, which greatly impresses the count. After the reception, limousines drive everyone to the dock to see Louise and the Romeros off. With the reporters safe and no real crimes committed, state and city officials, as well as newspaper editors, decide that no one need ever know the truth. As Annie lovingly waves goodbye to Louise, the Dude tells Queenie that he is going to move to Maryland with her and forget about Darcey, and after the boat pulls away, Annie orders her panhandling friends to get back to work.