In Budapest, Erik the Great, a magician, loves Julie his assistant, though he is more than 20 years her senior, and keeps Buffo, another assistant, under his hypnotic power.  Mark Royce, a vagrant and starving youth caught stealing in Erik's apartment, is taken in at the suggestion of Julie, and he becomes Buffo's assistant.  Mark and Julie fall in love.

Later, in New York, while preparing a U.S.  tour, Erik gives an eighteenth birthday party for Julie and plans to announce their engagement.  Julie has concealed her love for Mark, and the wildly jealous Buffo shows Erik the two of them embracing in a garden.  Erik then announces Julie's engagement to Mark.

During the opening performance, in which Mark does a sword trick, Buffo is killed; Mark is charged with murder, but at the trial, because of his love for Julie, Erik confesses that he planned the crime, then draws a dagger and kills himself.