Felix Ungar has just broken up with his wife. Despondent, he goes to kill himself but is saved by his friend Oscar Madison. With nowhere else to go, Felix is urged by Oscar to move in with him, at least for a while. The only problem is that Felix is neat, tidy, and neurotic, whereas Oscar is slovenly and casual.

In 1944, in Hungary, the wealthy Jewish industrialist Joseph Krauzenberg is forced by the Reichfьhrer Heinrich Himmler to deliver his 3,000 employee factory; his palace with his collection of antiques and arts; a large amount in gold; and his house to the Reich. In return, the Nazis would send his big family that is arrested in Gestapo safe and sound to the neutral Switzerland and then to Palestine. Himmler schedules a dinner with Krauzenberg and his wife Rachel Krauzenberg to sign the contract and orders the butcher Eichmann to not do harm to the imprisoned Jews relatives of Krauzenberg. Himmer also send the SS Edelhein to check the security of the palace and the two German house servants of Krauzenberg, Hans Vassman and his beautiful pregnant wife Ingrid Vassman. Hans and Ingrid are actually the Jews David and Leila Steinberg and members of the resistance. When the Krauzenberg couple concludes the negotiation with Himmler...