Guy Van Stratten, Robert Arden a small-time American smuggler in Europe, seeks out Jakob Zouk in Munich to warn him about a plot against his life. Zouk is terminally ill and receives the news with apathy, so Stratten explains his personal reasons for wanting to keep Zouk alive. His narrative unfolds through a series of flashbacks.
Stratten's story begins in Naples, where a tip points to Gregory Arkadin, Orson Welles a famous international oligarch of Georgian heritage, who harbors a dark secret centered on the name 'Sophie', Katina Paxinou. Stratten and his girlfriend Mily, Patricia Medina, travel to Arkadin's castle in Spain, hoping to use this fragment for blackmail. By striking up a friendship with Arkadin's daughter, Raina Arkadin, Paola Mori, Stratten gets himself invited into the castle.
Arkadin already knows about Stratten and Mily's interest in him, and of the couple's criminal history. Instead of turning them away, he openly offers to pay for information about his past, which has been erased by amnesia. Arkadin says that in 1927 he woke up in a square in Switzerland, with a large sum of money in his pocket and no memory of his identity or past career. He successfully rebuilt his life, but is troubled by not knowing how it began; Stratten impresses him as sufficiently discreet and enterprising to find out.
Arkadin takes Mily on a yacht cruise, while Stratten travels the world searching for clues. He communicates periodically with Raina and a romance forms between the two, much to Arkadin's displeasure. From interviews with a strange series of people—the proprietor of a flea circus, a junk-shop owner, an impoverished noblewoman in Paris, and a heroin addict he tortures with withdrawal—Stratten learns that the pre-1927 Arkadin was involved in a sex trafficking ring in Warsaw. "Sophie" is the former leader of the ring and Arkadin's old girlfriend, from whom he stole the money that he found in his pocket in Switzerland. She proves to be a relaxed, tolerant woman who remembers Arkadin with affection and has no intention of publicizing his past.
In the closing stages of the investigation, Stratten discovers that Arkadin has been following him and visiting all the witnesses. He confers with Raina, who startles him by saying that her father does not have amnesia; the entire pretext for hiring Stratten was a fraud.
Stratten attends Arkadin's Christmas Eve party in Munich, where he learns the real purpose of his investigation. Arkadin wished to cover up his criminal past, fearing especially that Raina might learn of it and cease to love him. He used Stratten to locate people possessing potentially dangerous evidence, all of whom have been murdered. Mily is also dead and Stratten has been framed for killing her, with the implication that he too will be silenced before the police catch him. Stratten hastens to find Jakob Zouk, the last surviving member of the sex trafficking ring, hoping to use him as some kind of weapon against Arkadin. Zouk grudgingly consents to go into hiding, but Arkadin soon traces him and has him stabbed to death.
Stratten makes a desperate new plan and buys the last seat on a plane to Barcelona. Raina has agreed to meet him at the airport; there he intends to reveal her father's secret, in the hope that this will break Arkadin’s spirit and make him abandon the plot. Arkadin realizes what Stratten is doing and pursues him in a private plane. Stratten and Raina connect at the airport, but she is almost immediately summoned to the control tower to talk to her father on the radio. With no time to explain, Stratten convinces her to say "it's too late". The lie fills Arkadin with despair, and he commits suicide by hurling himself out of his plane.
Ultimately Raina cannot condemn Stratten for the death of her father, but their love affair is at an end. She arranges for an old boyfriend to drive her away from the airport, leaving Stratten alone.
