Sir Guy Grand adopts homeless bum Youngman to be heir to his obscene wealth, and immediately begins bringing him into the intricacies of the family business, which is to prey upon people's greed by use of the vast holdings of the Grand empire. They leave no stone unturned as sporting events, restaurants, art galleries, and traditional pheasant hunts turn into lurid displays of bad manners and profiteering. Things climax at the social event of the season, the inaugural voyage of the new pleasure cruiser The Magic Christian.

Sir Guy Grand, a wealthy eccentric who is disillusioned with mankind, adopts a young tramp, renames him Youngman Grand, and sets out to demonstrate to Youngman that people are easily influenced by money and will do anything to get it. First he makes a travesty of sportsmanship when he goes on a grouse hunt with a machine gun, a tank, and a flame thrower. During an evening at the theater the audience is scandalized when the actor playing Hamlet is bribed to perform a striptease. At an exclusive dinner club, Sir Guy hands out money as he repulsively stuffs food into his mouth and smears it on his face. Later, he fixes a heavyweight championship bout so that the boxers kiss each other instead of fighting. Then he bids outrageously on a piece of junk at a Sotheby's auction, causing an American couple to believe in the worth of the item and outbid him. Sir Guy plans the social event of the season, a cruise on the ocean liner The Magic Christian . The cruise becomes chaotic when men dressed as Dracula, King Kong, and a host of other offensive characters frighten the passengers. Believing the ship to be sinking, the passengers rush to the deck and discover that the boat never left the dock. Finally, Sir Guy prepares a vat of urine, manure, and blood for his last demonstration to Youngman. He empties a suitcase full of money into the vat; as the crowd begin diving into the foul mixture, Sir Guy and Youngman leave for the peaceful park where they first met.