Plot

Lester is a homeless shoeshine boy living in a railway station. He's got this funny knack for picking the winning horses' names out of the paper while shining shoes. When word gets around, though, everyone wants a piece of the action.

At Union Station in Chicago, Illinois, a woman (Belinda Bremmer) rushes to place her suitcase in a storage locker and is stunned to find Lester (Gary Coleman), a 10-year-old orphan, inside asleep. Screaming, she runs away as Lester gets up, hefts his shoeshine box, and greets his friends throughout the station. At a pizza parlor, Lester plays trivia with the owner, Sam (Herb Edelman) and wins a free breakfast.

Lester stops at a health club for a shower, and counsels the attendant, Robert (Bill Russell), on his relationship with his teen aged son, Mark. The owner of a shoeshine concession chases Lester, complaining the boy is stealing business, but Lester gets away. When he spots Mary (Maureen Stapleton), the bag lady, going through trash, Lester offers her money for breakfast, but she refuses and insists he keep his money hidden from potential criminals.

While shining customers' shoes, Lester magically predicts the triple horse winners from the newspaper that his customers are reading. When he visits Jill (Lisa Eilbacher), a video arcade operator and aspiring singer, Lester tries to tell her about the day's winners, but she is not interested in gambling, and insists that Lester study on a computer trivia game. Jill is worried about Lester and offers to let him live with her, but he is afraid to go "up there" into the city.

Meanwhile, the lady with the suitcase insists that police officers find the child in the locker, claiming he might be dead. The shoe shine concessioner contacts Juvenile Services to report a child living in the train station and operating a business without a license. As police search lockers, a social worker, Frank (Michael Lembeck), arrives to investigate, and the shoeshine concessioner directs him to Jill, who refuses to cooperate. Frank is enamored of Jill and asks her on a date, but she has an audition.

The shoeshine concessioner spots Lester, and everyone chases the child, eventually catching him. Lester tries to convince Frank to bet on the winning horses instead of arresting him, but Frank insists that Lester must go to a shelter. After driving the boy to Juvenile Services, Frank convinces Jill to have lunch with him. Meanwhile, Lester escapes and returns to the train station.

At Frank's office, he tells his co-worker of Lester's claim and learns that Lester accurately predicted the day's triple winners. Frank races to Jill's audition and tells her that he wants to free Lester. At the train station, the lady with the suitcase and two police officers catch Lester, but Frank and Jill arrive and take custody. Lester is surprised that Frank will let him stay at the station, and Frank offers to cook dinner for Jill so they can determine how to handle the situation.

At his apartment, Frank questions her about the horses, and she admits that Lester always picks the winners, but she does not bet. Frank offers to let Lester stay with him, saying it would be feasible if Lester gave him tomorrow's winners. Jill is furious that Frank wants to exploit Lester and his magical ability, but he convinces her that it would help all of them.

At the station, Mary finds Lester and is nervous because she won $54 thousand after following Lester's advice. However, the boy is happy he can help change her image, and Mary spends her money on a makeover at an exclusive salon.

The next morning, Frank gets the day's winners from Lester. He bets and wins, but is taxed by an IRS agent. Frank returns to Lester and asks for the next day's winners, promising it will be his last time to ask. Frank places a bet for $50,000 with Harry, a bookie, whose Mafia boss assumes it is a "sucker's bet." The boss is furious when Frank wins $1 million and sends his men to steal back the money.

Jill and Frank plan to use the winnings to create a corporation with Lester as president, and the boy realizes they are trying to get him to leave the station. He does not want to go "up there," but Jill asks him to come to her second audition. Against Lester's objections, Frank puts the bag with $1 million in Lester's locker, then places Lester in a suitcase, so the boy will feel safe as they travel to Jill's performance. However, on the bus, a drug addict steals the suitcase, and runs away with it. Upon discovering Lester inside, the addict steals his clothes, forcing Lester to return to the train station wearing a cardboard box.

Meanwhile, the Mafia henchmen remove Lester's train station lockers containing the money and the boy's possessions.

When Jill and Frank find Lester, he vows never to return to the city. Meanwhile, Mary is interviewed on television and gives Lester credit for predicting the triple winners. The reporter also interviews the Mayor, who claims it is dangerous for a child to live in the station, and he plans an investigation.

Mary, the mayor and reporters arrive at the station, and chase Lester until he climbs a ladder to the ledge above Sam's restaurant. The mayor tries to talk Lester down, but the boy refuses. When Frank claims that he and Jill plan to marry and adopt Lester, the mayor negotiates a deal with the boy. Lester asks for a small business loan and, in return, he will help the mayor fix the city by providing $1 million within a week. The mayor insists the boy cannot live in a locker and agrees to fix a derailed train for Lester's accommodations for the week.

Later, Jill is upset that she and Frank are lying about adopting Lester. Frank argues that they are not ready to be parents, but admits he loves her. Lester uses the mayor's money to buy baggage carriers to start his new business, employing several local kids as porters.

At lunchtime, Frank and Sam are among the crowd listening to Lester's predictions, and profiting from their bets. At the end of the day, one of Lester's employees hits him and steals his money, so Lester hires Robert's son, Mark, for protection. When people learn of the attack, they arrive to check on Lester, bearing gifts and donations to help his campaign to fix the city.

Frank devises a plan to make even more money, and travels to Miami, Florida, and Los Angeles, California, to win more races. By the end of the week, Lester hands the mayor a check for $1 million. Later, Mark learns that Lester's employees have bought their own carts and are undercutting his business.

Frank and Jill discover that the $1 million was paid to banks, instead of fixing the city's problems, as promised. The mayor claims the law requires that bond holders be paid first, but now the city can borrow money from the banks again to solve problems. Lester feels betrayed, and Frank insists they can get even by getting rich themselves. Jill begs Lester not to do it, but the boy agrees with Frank. Jill admits they lied about intending to adopt him, insists she loves Lester, and leaves. Frank is certain she will return, and gets the racing sheet.

As the usual crowd surrounds him, Lester struggles to pick the winners, and is uncertain about his choices. Ignoring Lester's doubts, everyone places their bets and loses. Frank insists they will make it up the next day, but Lester's magical ability is gone and he refuses to try again. Frank leaves, the mayor locks the train car, and Lester gives his business to Mark. Mary finds the distraught child and consoles him, insisting that people do love him.

Later, Jill finds Lester at his locker, reveals she got the singing job, and asks him to live with her. Frank arrives, claiming they are a family, and although the world "up there" is difficult, they will face it together. As Lester takes their hands to leave, he announces that he can also predict the stock market.