Balu is a lavish spendthrift with a cavalier attitude towards life. Born to a rich father Chandrasekhar, he has a rampant and aggressive behaviour and gets into confrontations wherever he perceives injustice. Worried about Balu's behaviour, Chandrasekhar decides to send him to his friend and ex-militaryman Gangadharan's village – Uthama Palayam, to work for him for one year with a condition that Balu will not reveal that he is the son of Chandrasekhar.
Balu slowly gets accustomed to the village life and learns to work hard and develops a good relation with Gangadharan and his family. During his stay, he spars with an arrogant rich girl, Sumathi. Assuming Balu to be a poor villager, she tries to humiliate him and Balu responds in kind. Eventually they both fall in love.
Gangadharan's daughter (Sulakshana) also loves with Balu, but learns he is in love with Sumathi. A dejected Sulakshana agrees to marry a man chosen by her father. Sumathi's father, who had agreed to get her married to his partner's son, rescinds the proposal on Madhavi's request. This enrages the villainous partner and he kidnaps Sumathi to marry her by force to his son. Balu rescues her and leaves her in the custody of Gangadharan's daughter and her suitor. However, the suitor betrays his trust and turns her over back to the partner and his son.
In a final fight sequence, Balu rescues Sumathi and returns her to her father. Balu then leaves the village after learning hard work, discipline and many other good virtues from Gangadharan. The final scene shows Sumathi and her father at Balu's father house discussing marriage for Sumathi. Sumathi initially refuses, but soon realizes that she is actually in Balu's house and to everyone's surprise, Balu clad in a full suit walks down the stairs.
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