Three down-and-out Americans meet by chance in the Mexican city of Tampico and discuss how to overcome their financial distress. They then set out to discover gold in the remote Sierra Madre mountains.
Once in the desert, Howard, an experienced old-timer, quickly proves to be the toughest and most knowledgeable; he is the one who discovers the gold they are seeking. A mine is dug, and much gold is extracted, but one of the men (Dobbs) soon becomes greedy and begins to lose both his trust and his mind, lusting to possess the entire treasure. One day, another prospector named Lacaud follows one of the men (Curtin) from a nearby village back to the men’s camp. Although the men do not initially trust Lacaud, they decide to allow him to stay and camp with them.
The bandits then reappear, pretending, very crudely, to be Federales. After a gunfight, a troop of real Federales arrives and drives the bandits away. The prospectors soon decide to leave the mine and head to Durango to sell the gold that they have mined. Lacaud decides to stay behind, because he believes there is more gold in the mountain. On the way, Howard is called to assist some local villagers help a sick boy, and Dobbs and Curtin have a final confrontation. Dobbs shoots Curtin, leaving him lying shot and bleeding. Dobbs continues on alone but is soon confronted and killed by the leader of the bandits and two of his remaining henchmen who, apparently, had been wandering the desert without weapons or horses after having somehow escaping the Federales. The bandits, thinking the gold dust is just worthless sand used to make the bundles of skins they were hidden in seem heavier, scatter the paydirt; they are later captured and executed by theFederales. Curtin (who has survived Dobbs’ attack) meets up with Howard. When they hear the story they can do nothing but laugh at their misfortunes.