Set in the 1930's the movie begins with a meeting of two mob bosses, Caspar (italian mob) and Leo (Irish mob). Caspar tells Leo that he intends to kill Bernie, a bookie that Caspar occasionally uses, who has been selling information on when Caspar fixes fights. Leo refuses to let Caspar kill Bernie. Tom, who is Leo's right hand man, tells Leo that he's starting a war with Caspar and advises Leo to give up Bernie. Leo says he can't because he's dating Bernie's sister Verna.
Tom is also dating Verna. The war starts between the two mobs. Tom admits to Leo he's been seeing Verna and Leo kicks him out of the mob. Tom joins up with Caspar, but rubs Caspar's right hand man Eddie the wrong way.
Tom does some snooping, finds Bernie and finds out that Bernie has been selling out Caspar's fixed fights. Bernie, who is gay, has been seeing Mink, who is Eddie's "boy". Mink has been giving Bernie the tip on which fights to sell out.
Tom tells Caspar where Bernie is hiding. Caspar's henchmen pick up Bernie and take him and Tom out to Miller's Crossing. Tom is told that he is supposed to kill Bernie. Tom walks Bernie out into the middle of the woods where he is supposed to shoot him. Bernie begs for his life.Tom, who has never killed anyone, let's Bernie go but fires a couple of shots to make it sound like he killed Bernie.
They return to the city and the mob war continues.
When Eddie hears that no one went in the woods to check if Bernie was dead or not, he takes Tom and a couple of guys out to Miller's Crossing. They walk out to the woods and Eddie tells Tom that if they don't find a body, he's leaving Tom's body behind. Tom throws up and is about to be killed when they stumble upon a dead body recently shot in the face. The body provides evidence for Tom's story.
Bernie realizes that he has no money or prospects and blackmails Tom, threatening to be seen in public unless Tom pays him.Tom tries to jump Bernie as he leaves, but fails.
Bernie calls Tom about money, and Tom tells him that unless he meets him tonight he'll let it be known that Bernie is alive (the same threat Bernie used on Tom)
Tom tells Caspar that Eddie and Mink were the ones selling out the fixed fights, and uses Mink's absence as a suggestion that he is guilty. Eddie tries to kill Tom, but Caspar, convinced Eddie is cheating him, kills Eddie. Tom sends Caspar to his apartment, knowing that Bernie will be waiting.
Bernie was waiting to jump Tom and ends up killing Caspar. Tom shows up and tells Bernie that with Caspar dead their problems are solved and they can blame Eddie. With Bernie convinced that everything is okay, Tom gets some answers. Bernie confesses to killing Mink and leaving him in Miller's crossing. Which eliminated a loose thread who was getting nervous and leaving Tom some insurance if anybody checked his story. Tom tells Bernie that Eddie is dead and can't take the fall for Caspar's death and pulls a gun on Bernie. Bernie again begs for his life, but Tom is a different man than he was back in Miller's Crossing and kills Bernie.
Killing Bernie finally puts the nail in coffin of Tom's relationship with Verna. At Bernie's funeral Leo tries to get Tom to come back, but Tom refuses. Verna drives off in the car, Leo walks back, and Tom stands watching Leo leave.
Continuity mistake: When Bernie pays a visit to Tom after he decided not to kill him, Bernie has a pistol lying on the small table next to the armchair he is sitting on. When Bernie is talking first the gun is white, but when the shot changes to Tom and back to Bernie the pistol somehow turns into a black one.
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