In 1870s Arizona territory, young Jed Coburn watches helplessly as a vigilante group hangs his father as a horse thief. Jed is outraged when his older brother John renounces their father and assumes the name "John Brazos." The vigilante leader then dubs Jed "Chip" for being as stubborn as his father. Upon reaching adulthood, Chip starts a notorious horse rustling band called the Blue Chip Gang, recognized by their colorful outfits. John becomes a U.S. marshal in Prescott and arrests Chip, who then serves eight years in prison. Upon Chip's release, John cautions his brother not to return to a life of crime and suggests that Chip end his disreputable relationship with saloon girl Lou Crenshaw. Later, Chip visits Lou to promise that he will soon own property and settle down, then departs for a meeting with Matt Chissum at the Turkey Track Ranch. Stopped at Turkey Track by ranchhands Cass and Hondo, Chip presents a letter from Chissum stating that the rancher has agreed to trade several hundred acres of the prime Santa Clara Valley for Chip's herd of wild horses. Cass and Hondo then inform Chip that Chissum has recently died, thus voiding the land agreement. Chip returns to town where his old friend, town sheriff Will Blane, explains that Turkey Track overseer Ben Bodeen intentionally allowed Chissum to drink himself to death hoping to take over the ranch. Will asks Chip to be his deputy and help prevent Bodeen's men from stirring up trouble against the area farmers, but Chip turns him down. When Chip tells Lou that his plans have been delayed, she admits that she has tired of waiting and is going to accept Bodeen's marriage proposal. That afternoon, Will introduces Chip to Tom Haney, the head of the Grange, a farmer's association planning to bid on the Santa Clara Valley tract at the Chissum public land auction. Meanwhile at the saloon, Cass welcomes hired gun Notches Pole, whom he has hired to kill Will and make his murder look like self-defense. After Will's murder, Bodeen appoints Cass as the new sheriff until the next election. The following day, Chip's former partner in crime, Slick Kirby, unexpectedly comes to town and suggests that they go to work for Bodeen. Chip then declares the Blue Chip Gang is dead. At the auction, Bodeen bids on each tract of Chissum land, but when the Santa Clara Valley tract is offered the auctioneer tells Bodeen that he has reached his bidding limit, so Tom's bid is accepted. After Tom tells the auctioneer that the Grange's funds will take ten days to arrive from Kansas City, the auctioneer warns him that if the money is not paid by that time, the land will be open to any bidder. Moved by Tom's declaration of faith that the basin land is the farmers' due, Chip decides to bring back the Blue Chip Gang in hopes of frightening Bodeen. After the Blue Chip is forced to kill Hondo in self-defense, Bodeen decides to turn the town against them by having his men attack farms disguised in the Blue Chip's distinctive bright clothing. The violent raids soon come to John's attention in Prescott. Resigned to Chip's criminal ways, he sets out to arrest his brother despite protests from Katy Porter, Chip's former girl friend, who insists upon traveling with him. The day before the Grange's money is scheduled to arrive, Tom visits Chip's hideout and states that although the farmers believe Chip is guilty, Tom believes in his innocence, and offers him sanctuary. Meanwhile, John visits the Haney farm in search of Tom and, upon intervening in what he believes is an attack by the Blue Chip gang, thinks that he has wounded Chip. When Tom arrives after the attack and asserts that he was with Chip, John refuses to believe him. Meanwhile in a plan arranged with Slick, Chip offers to work for Bodeen if he will stop the farm raids. Bodeen agrees to Chip's suggestion to intercept the Omaha Stage bringing the Grange funds, but when Notches returns with the money bag, they discover that it is empty. Realizing Chip has alerted the farmers to the robbery, Bodeen refuses to listen to Lou's pleas on Chip's behalf. Chip then offers to prevent Tom from making his payment the following day in exchange for several acres of land. Bodeen agrees, but later in private, not realizing that Lou is eavesdropping, orders Notches and Cass to kill Chip and John after dealing with Tom. Lou rides out to warn John of the trap, but he refuses to believe that Chip is innocent. The next day when Tom arrives in town with John, Cass wounds John, who remains undeterred. Slick arrives and he and Chip prevent Bodeen's men from attacking. In the ensuing shootout, Lou is wounded protecting Chip, who finally kills Bodeen. Chip then carries Lou away to safety as John admits to Katy and Tom that he was wrong about his brother and will help clear him of Hondo's murder.
