In the film Pocketful of Miracles, Dave the Dude, a highly successful New York City gangster, clings to a superstition: the apples he buys from the alcoholic street peddler Apple Annie bring him luck. Annie assures him that the latest purchase is especially lucky. When he crosses paths with Elizabeth "Queenie" Martin, Hope Lange — the daughter of a friend and a speakeasy owner recently murdered for owing money to the wrong people — he learns she is eager to change her fortunes. Queenie offers to pay him $5 a week from her cashier’s salary toward the $20,000 he is owed, but Dave, trusting Annie’s claim, decides to turn Queenie into a nightclub star. To the astonishment of his right-hand man, Joy Boy, he succeeds, and Queenie is able to pay off all her father’s creditors after two years, just as Prohibition ends.
Dave has an important meeting with a very powerful underworld boss from Chicago, Steve Darcey aka "Mr. Big." Darcey is weighing whether to allow Dave to control the New York territory in exchange for $50,000 "as a token of good faith." Dave counters by demanding $100,000 "as a token of your good faith."
Meanwhile, Annie has an illegitimate daughter named Louise, Ann-Margret, whom she sent to Europe as a baby. In her letters to Louise, she masquerades as wealthy socialite Mrs. E. Worthington Manville, sending Louise money she gets from the Dude and various "godparents." Louise, now grown up, is bringing her Spanish fiancé Carlos and his father, Count Alfonso Romero, to meet her. Annie has been pretending she resides in a luxurious hotel (writing her letters on stolen hotel stationery) and has Louise’s letters mailed there, intercepted for her by an employee. However, the employee is fired when this is found out.
Dave’s girlfriend Queenie insists he help Annie continue her charade. Dave reluctantly goes along, worried that his luck would run out otherwise. Queenie has the bedraggled Annie made up to look like a sophisticated socialite, while Dave borrows an out-of-town friend’s luxurious penthouse suite, complete with Hudgins the butler, and arranges for cultured pool hustler "Judge" Henry G. Blake to pose as Annie’s husband.
When Dave keeps postponing finalizing the deal with Mr. Big to help Annie, Joy Boy becomes increasingly exasperated and frightened. Dave manages to engineer a lavish reception, with Jerome Cowan as the Mayor and David Brian as the Governor, as guests, the night before Louise and her impressed future husband and father-in-law sail back to Europe, none the wiser about her mother’s real identity. Mr. Big agrees to the Dude’s terms, but the Dude decides to marry Queenie and settle down.
