The gang is sent to the Wilton Reform School after they are unjustly convicted of stealing a truck. Bill Collins, brother of co-leader Danny, becomes involved in a killing and, while also innocent, is convicted and sentenced to death. Through a series of events, Muggs, Glimpy, Danny and the rest of the gang, learn that Knobby, a henchman of Luke Manning, knows something about the murder.

The story—in which an American heiress on holiday in South America falls in love with an Argentine horse breeder against the wishes of their families—takes a backseat to the spectacular location shooting and parade of extravagant musical numbers, which include the larger-than-life Carmen Miranda singing the hit “South American Way” and a showstopping dance routine by the always amazing Nicholas Brothers.

A seemingly charitable soup kitchen operator (who moonlights as a criminology professor) uses his Bowery mission as a front for his criminal gang. Police attempt to close in on the gang as they commit a series of robberies, murders and bizarre experiments on corpses.

The East Side Kids discover that one of their own, Danny, is torn between staying in school and becoming a boxer, and is getting mixed up with gangsters.

A popular high school valedictorian and star athlete becomes a pariah when it's discovered that his father is a former bootlegger.

Fortune hunter Mary Brooks, posing as a missionary's daughter, strives to beat a couple of pilots, Terry Prescott and "Waffles" Billings, (who have turned pearl divers in order to buy a plane and join the Royal Air Force), out of their pearls, while also beating off the advances of Prince Sali who wants to add her to his harem.

Sent by cutthroat pirates to turn Kehane’s head while they loot his island paradise of a fortune in pearls, Ruby instead falls for the young chief. Together, the two save Kehane’s people and their island home from the rapacious picaroons but at the tragic cost of their own future together.

Muggs is tricked into entering a Civilian Conservation Corps camp by Danny in order to get in shape. Muggs resists and battles with the camp captain and with other campers. He also becomes involved in trying to help one of his friends get out of trouble.

The East Side Kids find a young girl in the apartment of a man who has just been murdered. Believing her to be innocent, they hide her in their clubhouse while they try to find the real killer. The killer, however, used a baseball bat as his murder weapon, and the bat has the fingerprints of one of the gang on it.

Ordered by a judge to get a job, Muggs McGinnis is hired by wealthy Mrs. Murray, who has a penchant for picking up trouble-prone servants. At an engagement party for Mrs. Murray's spoiled daughter Brenda, Muggs enlists his pals as extra help.