To a valley held by squatters since their ancestors took it from the Indians come two strangers who are regarded with hostility by the natives. Engineer John Marshall's mission is mysterious and he chooses to live in a cabin long believed to be haunted. The cabin's history is connected with district schoolteacher Mary Elizabeth Dale. She comes to the valley unaware that her father, Welchel Dale, original owner of the cabin, was lynched by some angry bootleggers who suspected that he was a revenue agent. The squatters learn that Marshall's mission is to take over their land, enabling Marshall's company to dam the valley, thus providing power for a nearby industrial town. After convincing Marshall that the company should pay the squatters for the land, Mary Elizabeth helps him when an angry mob arrives to lynch him. During the melee two villainous men and one innocent boy are killed; when peace finally comes to the valley, the folk, sobered by the deaths, accept Marshall's generous compensation and consent to move. John weds Mary.—AFI