Oliver, an orange tabby kitten, is lost in the streets. He was the only kitten of his fellow kittens not to be adopted. Left alone in the rain in a cardboard box, he escapes and lives in the streets. He steals some hot dogs from a hot dog vendor with the help of a dog named Dodger. Together they are successful, but Dodger runs off, attempting to leave Oliver behind.

Dodger eventually arrives at the barge of his owner, a petty criminal named Fagin, along with his meal, to share with his friends: Tito the Chihuahua, Einstein the Great Dane, Rita the Saluki, and Francisthe Bulldog. Oliver sneaks into their home, located below the city's docks, and is discovered by the dogs. At first, they, except Dodger, think that he is a spy, but when he explains his involvement in Dodger's hot dog theft, they begin to develop respect for him. Later, Fagin comes in and explains that he is running out of time to repay the money he borrowed from Bill Sykes, a shipyard agent and ruthless loan shark. He and his Dobermans, Roscoe and DeSoto, arrive. Fagin tries to appease Sykes with leftover items located from the streets, but it does not work.

While DeSoto is sniffing around the barge, Roscoe flirts with Rita. When Tito tries to attack him; after Roscoe threatens Francis after he insulted him, he is held back by Einstein, who tells Roscoe to pick on somebody his own size, but Roscoe is not intimidated by him. He is asked by Dodger about whether he lost his sense of humor or not and in reply, Roscoe smashes their television. It is then that DeSoto finds Oliver. He scratches his nose after DeSoto attempts to eat him and Roscoe and DeSoto both intend to tear him apart when the dog gang gets between them. Before further violence can ensue, Sykes calls his dogs back to his car, and they leave while making threats towards the gang and Oliver.

After this, a soaking wet Fagin returns to the barge, lamenting that he has only three days to find the money he owes Sykes. He discovers Oliver and, considering that they all need help, accepts him into the gang.

Next day, Fagin sets out into the city with his canine menagerie and Oliver. While he tries to sell his wares at a pawn shop, the animals come face-to-face with a limousine driven by a man named Winston. He is the butler of the exceedingly wealthy Foxworth family and is taking care of their daughter, Jenny, while they're out of the country on business in Europe. The dogs stage an elaborate ruse in order to get Winston out of the car. Einstein hits it to make it look like Winston had hit someone and Francis (being the only member of the gang with a passion and love for the art of acting and the theater) comes in his place to play the role of the hit dog. While Winston tends to Francis, Tito and Oliver slip in and attempt to steal its radio so as to give it to Fagin in order to sell it and earn some money in return for partial payment to Sykes. In doing so, Tito gets shocked by the electrical system, due to Oliver's mishap with the car keys and the ignition, and Jenny finds Oliver tangled up in the wires near it. Oliver finds a good home and a caring owner in Jenny, to the chagrin of Winston and the Foxworths' spoiled poodle, Georgette.

The next day, Fagin's dogs go to Jenny's house to "rescue" Oliver; thinking he is in danger and being tortured. After some initial disputes, Georgette is very happy that they are here to collect him and helps them take him back, convincing them that he's been traumatized by the whole experience and wants to go back to them. When he is taken back, he is sad because he was happy living with Jenny. Dodger is upset, nevertheless, he allows him to leave. The gang is sad to see him leave and he, full of sadness and sorrow, is sad to leave them. Before having the chance, Fagin comes in, takes him back in, and sits in his chair, full of sadness, because of his lack of hope and luck of earning some money. Later, he sees Oliver's new golden tag and the wealthy district he got it from and sends Jenny a map and a letter requesting "lots and lots of money" as a ransom. He then goes to convince Sykes that his plan will work. While he intends only to ransom Oliver, Sykes believes that he is "thinking big" in an attempt to kidnap and ransom the cat owner, and gives him 12 more hours.

Jenny receives the letter and takes Georgette with her to go and retrieve Oliver, but Fagin's poorly drawn map leaves them both totally lost, although they do unknowingly arrive at their destination. Being distraught that his "wealthy cat owner" is only a little girl with her piggy bank, Fagin decides that he might as well return Oliver to her, and pretends to find him in a dumpster. However, Sykes, who was unknowingly watching the whole thing, kidnaps Jenny, intending to hold her for ransom to her wealthy parents, and tells Fagin to keep his mouth shut and to consider their account closed.

Fagin, who was not expecting Sykes to use him to perform a for-real kidnapping, takes his dogs and Georgette to Sykes' warehouse to rescue Jenny, which the dogs, with Oliver's help, manage to do. However, an enraged Sykes and his Dobermans pursue them down the city streets and into the subway in his car intending to snatch Jenny back. Roscoe and DeSoto both fall onto the tracks in their fight with Dodger and Oliver and get electrocuted. Jenny is thrown onto the hood of Sykes' car and Fagin tries to snatch her back while the dogs (mostly Tito) drive. Fagin manages to save Jenny while Oliver and Dodger fight off Sykes. They emerge onto the Brooklyn Bridge, where Sykes' car collides with a train and he is killed. Tito manages to steer Fagin's scooter onto one of the bridge's cables and they emerge unscathed. After the incident, Dodger, who along with Oliver was thrown away by Sykes before his untimely death, hands Jenny a "thought to be dead" Oliver. Everyone else thinks he's dead until Jenny hears a soft meow, meaning that he is alive. Everyone is rejoiced and accepted as Jenny's new best friends, except Georgette who is still in great shock from the chase.

The next morning, Fagin and the entire group celebrate Jenny's birthday at her home. That same day, Winston receives a phone call from her parents in Rome saying that they will be back tomorrow while making a bet with Fagin on wrestlers on TV, apparently earlier than expected; probably as an unexpected beautiful surprise for Jenny. Fagin and his dogs finally drive into the streets to make a new start while leaving Oliver at his new home with Jenny.