In New York City, 1953, at the height of the anti-Communist investigations of the House Un-American Activities Committee (HUAC), television screenwriter Alfred Miller [Michael Murphy] is blacklisted and cannot get work. He asks his friend Howard Prince [Woody Allen], a restaurant cashier and small-time bookie, to sign his name to Miller's television scripts in exchange for ten percent of the money Miller makes from them, i.e. to serve as a "front" for Miller. Howard agrees out of friendship and because he needs the money. The scripts are submitted to network producer Phil Sussman [Herschel Bernardi], who is pleased to have a writer not on the television blacklist. Howard's script also offers a plum role for Hecky Brown [Zero Mostel], one of Sussman's top actors.
Howard becomes such a success that Miller's two fellow screenwriter friends hire him to be their front as well. The quality of the scripts and Howard's ability to write so many impresses Florence Barrett [Andrea Marcovicci], Sussman's idealistic script editor, who mistakes him for a principled artist. Howard begins dating her but changes the subject whenever she wants to discuss his work.
As investigators expose and blacklist Communists in the entertainment industry, Hecky Brown is fired from the show because six years earlier he marched in a May Day parade and subscribed to The Daily Worker, although he tells the investigators he did it merely to impress a woman he wanted to have sex with. In order to clear his name from the blacklist, Hecky is instructed to find out more about Howard Prince's involvement with the Communist Party, so he invites him to the Catskills, where Hecky is booked to perform on stage. The club owner short-changes Hecky on his promised salary, and when Hecky confronts him, the club owner fires him, denouncing him as a "communist son of a bitch". The professional humiliation and the inability to provide for his wife and children take their toll on Hecky and he kills himself by jumping out of a hotel window.
Howard witnesses other harsh results of the investigative actions of the communist-hunting "Freedom Information Services" on the network's programming. Suspicion is cast his way, and he is called to testify before the House Un-American Activities Committee. He privately tells Florence that he is not a writer, just a humble cashier.
Howard decides that he will respond to the Committee's questions evasively, enabling him to neither admit nor deny anything. After briefly enduring the HUAC questioning — including being asked to speak ill of the dead Hecky Brown, and being threatened with legal consequences for his admission of having placed bets in his capacity as a bookie (which is illegal), Howard takes a stand, telling the Committee that he does not recognize their authority to ask him such questions, and telling them to
> go fuck yourselves
before leaving the interrogation room. The film ends as Howard is taken away in handcuffs, with Florence kissing him good-bye and many protesters cheering him on.