Small-time crook Harry Bundage discovers that the old manor house where Lady St. Edmund resides, with three orphans and her butler Priory is the resting place for a hoard of treasure. Unfortunately, he doesn't know where it is. Bundage recruits urchin Casey Brown to dupe Lady St. Edmund into thinking that she is her long-lost granddaughter, so she can search for clues to the location of the treasure. Unbeknownst to Bundage AND her ladyship, Lady St. Edmund is flat broke, and Priory and the children help her ladyship try to keep her home and pride. Joined by Casey, they do all the chores and Priory acts as the butler, gardener, chauffeur and an old major all at the same time!
- Casey Brown (Jodie Foster) is a young girl in her early teens living on the streets in LA. She spends her days roving with other kids around the same age, shoplifting and making general mischief. One night when she returns to her shabby foster home, she finds that her foster parents seem to have sold her out to a suspicious looking man (John Alderson). The man takes her away in a car, and Casey assumes that he is a policeman who will arrest her for her crimes.
Casey finds, however, that the man takes her to a fancy hotel and tells her to take a bath. Another man appears and identifies himself as Harry Bundage (Leo McKern). The man has simply delivered Casey to Bundage based on her appearance and two notable scars on her body, which seem to greatly interest Bundage.
Casey soon learns that Bundage is a con artist who intends to use Casey in a scam. The scars on her body match those of a little girl who disappeared in the Los Angeles area many years ago; the girl was an English heiress named Lady Margaret who disappeared after being spirited to the United States by her errant father. Bundage needs Casey to pose as this heiress, Lady Margaret, to gain access to Candleshoe, the regal home of Lady St. Edmund (Helen Hayes). While there, she will search for a hidden treasure that was secreted there many years prior by the now-deceased husband of Lady St. Edmund, a pirate named Captain Joshua. Bundage has an advantage because his sketchy sister, Clara Grimsworthy (Vivian Pickles), was once a housekeeper at Candleshoe and discovered a document that gives the first clue for the treasure hunt.
Casey agrees, and Bundage takes her back to England to prepare for the ruse. There, she learns about Lady Margaret, and Grimsworthy trains her to remember all the details known about the girl, including all of the foods Margaret liked and disliked. Once they feel she is ready to pull off the con, Bundage arranges a meeting by sending Lady St. Edmund a letter announcing that he thinks he has discovered her granddaughter. The Lady is skeptical, but agrees to a meeting anyway.
Bundage and Casey arrive at Candleshoe and are greeted by the butler, Priory (David Niven). After Casey catches glimpses of several other children lurking around the mansion, Priory introduces them to Lady St. Edmund, who invites them to tea and hears Bundage's phony story about discovering Casey. Casey is good at the con game and responds appropriately when Priory tries to fool her into eating food that triggered Margaret's allergies. Casey finally amazes Priory and Lady St. Edmund by revealing that she knows about a secret hiding place in the large fireplace, and when they check, they discover a hidden music box. Casey knows that it plays "Greensleeves", and immediately Lady St. Edmund is convinced, weeping and welcoming the child back into her home.
Once installed in Candleshoe, Casey learns that the other children at the mansion are from a local orphanage. Peter (Ian Sharrock), Cluny (Veronica Quilligan), Bobby (David Samuels) and Anna (Sarah Tamakuni) all live at Candleshoe and are treated as if they are part of Lady St. Edmund's family. Casey also learns that Priory is literally the only servant in the place, despite the fact that the Lady appears to have no idea of this. Priory wears a series of disguises that he dons in order to convince the Lady that Candleshoe is still financially solvent enough to afford servants. In reality, they are always on the verge of foreclosure, having sold off all of the valuable art and objects in the place and replaced them with copies. Priory and the children do all the work to keep the place running, including selling baked goods and homegrown produce in the market on Saturdays.
Casey is hostile at first and is only concerned with finding the treasure. She finds one clue in the library and another written on a tombstone in a graveyard, but Cluny suspects her of being up to no good and attempts to intervene. Casey refuses to help do any of the work, and she comes to blows with Cluny over it.
Casey is also hesitant to accept the love that Lady St. Edmund wants to give her as her grandmother, but eventually she begins to soften and realizes that she is accepted into their home and is part of their family. Even Cluny has forgiven her for their scuffle, especially since Casey refused to snitch on her to the Lady. Casey also helps Priory continue his ruse as the various servants, while she gives them sales tips on how to make more money in the marketplace. Suddenly her idyll is interrupted by Bundage, who steals their marketplace money from Casey as she is on her way home. Casey argues that if the steals the money, Lady St. Edmund and the others will be evicted. Bundage tells her that with the place cleared out and the occupants gone, they'll be able to strip Candleshoe and find the treasure. Casey tries to stop him and she gets slammed into a tree by Bundage as he pulls away in his car.
As Casey recovers from her injuries in the hospital, she is paid a visit first by Lady St. Edmund and, later, by the other children. They inform Casey that with the money gone, Candleshoe is being put up for sale, and they must return to the orphanage. She initially sticks by her story that she does not know who attacked her, but Casey suddenly has a change of heart and finally tells the truth about everything to the kids, as well as to Lady St. Edmund and Priory. Lady St. Edmund correctly interprets the last known clue, which directed the treasure seekers to a painting that depicted Captain Joshua aboard his ship. Priory, however, has sold the painting to the local antiques dealer, who in turn has sold it that day to a foreign visitor who is leaving aboard a train. The group climbs into the car and races to the station only to find out that the train has left. Undaunted, Lady St. Edmund urges Priory to give chase, and they manage to flag down the train. The painting reveals the final clue of the treasure hunt: the treasure is located in the Grand Hall of Candleshoe, "under foot".
Returning to the mansion, the group is startled to discover Bundage and his cronies, including Grimsworthy, tearing the place apart. The two groups clash and engage in a protracted battle, which includes Bundage and Priory duelling with swords and the children distracting Bundage's goons. Peter manages to summon the police, who return just as Bundage inadvertently discovers the hiding place of the treasure, which was secreted inside a statue of Captain Joshua himself.
With Bundage and his gang taken into custody by the authorities, and with Lady St. Edmund suddenly very wealthy again due to the treasure, everyone is able to return to Candleshoe and be a family once again. Casey, however, packs her bag and leaves the estate without saying goodbye. As she waits at the train station alone, she looks up and sees Lady St. Edmund approaching her, with Priory waiting in the distance. She asks Casey why she is sneaking off, and Casey tells her that she feels guilty for arriving at Candleshoe to swindle her out of her fortune. The deception bothers Casey because now she realizes that she cares for Lady St. Edmund, who has been so kind to her from the very beginning. The Lady says it doesn't matter to her why Casey came to Candleshoe in the first place, she is only concerned about whether Casey really wants to leave. Casey, who has been so cool and calculating before, breaks down into tears. Lady St. Edmund stands and announces that she's taking Casey home, and together they return to the car and drive back to Candleshoe, where the other kids rush out to greet her and welcome her back. The last lines of the film occur when Casey says "What if your real granddaughter shows up?" Lady St. Edmund replies, "Perhaps she already has."