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Eleven-year-old Tommy Ryan is forced to leave Holbrook Military Academy, which he has attended for four years, after his deceased father's estate runs out of money. Tommy is crushed, and when orphans' home superintendent Eli Bunting attempts to separate him from his beloved dog Skippy, Tommy and Skippy run away. The pals travel until Tommy sees an ad for a dog show which offers a $15,000 first prize. Tommy hitches a ride to High Hills, where the show will be held, from newspaper reporter Bob Clayton, who is covering the show. After Bob drops Tommy off, Tommy is hit by a car driven by drunken Dave Farmer, and Skippy attacks Farmer. Everyone is all right, however, and after Tommy and Skippy are examined by kindly veterinarian Doc Will Ramsey and his granddaughter Lorna, Doc stops police officer Lou Manning from arresting Skippy for being vicious. Later that day, Bob takes Tommy and Skippy to the show, where Tommy overhears Farmer being fired by Martin Sands, president of the Kennel Club, because Sands has just sold his dogs to Parker, another owner. Sands throws Farmer out into the waiting room, where Skippy attacks him again. Farmer escapes and Sands informs Tommy that he cannot enter Skippy in the show because he has no pedigree. Doc helps the disappointed boy sneak into the auditorium that night to put Skippy with the other dogs, but they find that the dogs have been unchained. Doc stalls the guard while Tommy and Skippy escape, and afterwards it is discovered that four dogs are missing. While the police search for Tommy and Skippy, Bob and Lorna answer a mysterious phone call. The caller is Farmer, who is about to reveal who is responsible for letting the dogs loose, when Doc arrives at the meeting place and scares Farmer away. Tommy and Skippy see Farmer, and after Skippy runs off to chase him, Tommy is found by Doc. After Lorna takes Tommy home, Bob finds Farmer's corpse, and Skippy is suspected of killing him. An injured Skippy arrives at Doc's home, and the next day Tommy and Skippy try to run away. Lou finds them, however, and Skippy is arrested. He is about to be killed when Bob protests to District Attorney Hughes that Skippy should be given a trial, and his newspaper begins a publicity campaign demanding Skippy's fair treatment. The publicity forces Hughes to acquiesce and the trial begins. Despite Doc's testimony that Skippy was provoked by Farmer's injuring Tommy, the judge is convinced that Skippy is vicious, and he orders the dog be killed and Tommy be sent to the orphanage. Tommy escapes from Bunting early the next morning, and after freeing Skippy from the pound, the pair go to the scene of the crime. There Tommy finds a garden rake, which he believes to be the murder weapon, as it makes Skippy growl, and he sends Skippy to get Doc. Tommy then discovers the missing dogs in a nearby barn, but he is captured by Sands. In their struggle they set the barn on fire, but Bob arrives in time to save the trapped Tommy, while Skippy apprehends Sands. Sands confesses that he accidently killed Farmer with the rake after Farmer found out that Sands stole the dogs in order to help Parker win the show. Later, Bob's newspaper gives Tommy a scholarship to Holbrook, and Bob, Doc and Lorna proudly watch Tommy and Skippy march with his class.