The action takes place in the late 1920's. Freddie Bosham, the son of Lord Middlewick, is desperate to marry his true love, Phyllis. But Phyllis' father will not allow the union unless Freddie works for the family jam business or invests 5,000 pounds in the company. Naturally, the idea of work is anathema to Freddie, so he seeks to borrow the money from his father. The loan is not forthcoming, but Lady Middlewick returns from London with the highly valuable Dulworthy Diamonds, a family legacy. Freddie then hatches a plot to steal the diamonds from his mother with the help of the engaging rogue Psmith.

Psmith takes on the character of an American poet in order to gain entry to the Middlewick's home, but also manages to fall in love with a newly-employed librarian. However, Lord Middlewick's secretary has her suspicions about Psmith, while a fake English gentleman and a female American writer also have their eyes on the Dulworthy Diamonds...