In a rather charming prologue an elderly Toymaker (Semon) reads The Wizard of Oz to his sleepy granddaughter.
On a Kansas farm lives 17 year-old Dorothy (Dorothy Dwan) and her kindly Aunt Em (Mary Carr), her overbearing Uncle Henry (Frank Alexander), and three farmhands. Two are unnamed, one being the sallow-faced Semon and the other none other than Oliver Hardy. Both are fond of Dorothy. The third is Snowball, a black man played by an actor named Spencer Bell (billed unfortunately as “G. Howe Black”).
After several examples of Semon’s deft slapstickery, emissaries from Oz led by Ambassador Wikked (Otto Lederer), arrive by airplane. Dorothy, who had been left on Em and Henry’s doorstep as a baby, is actually Princess Dorothea, the rightful ruler of Oz. Wikked intends to stop her from learning of her heritage, which is explained in a sealed envelope he tries to get Hardy to secure for him.
A sudden tornado whisks Dorothy, Uncle Henry, the three farmhands, and the Ozites to Oz, an opulent kingdom currently ruled by the usurper Prime Minister Kruel (Joseph Swickard). Thanks to Semon, Dorothy learns who she truly is, and the rest of the film involves the efforts of Semon and the dashing Prince Kynd (Bryant Washburn) to put her on the throne.
Their efforts are opposed by Kruel, Wikked, and the Lady Vishuss (Virginia Pearson), rotters all, as you'll have gathered from the names. Kruel’s other minion, the Wizard (Charles Murray), is the character most like his literary antecedent, a two-bit carny swindler whose greatest illusion is conjuring up “The Phantom of the Basket” (female impersonator Frederick Ko Vert).
Despite having no courage, the Wizard has a good heart, and Semon helps him by dressing up as a Scarecrow brought to life by the Wizard’s alleged magic, even as Hardy falls onto a “pile of tin” and emerges in a Tin Man costume.
Eventually, through the Tin Man’s treachery, the Scarecrow ends up in a lions' den, where he is relieved to find that one of the beasts is Snowball, who has disguised himself in a lion skin to avoid detection. They manage to escape as Kruel, determined to force Dorothy into marriage, is attacked by Kynd. In the resultant swordfight, the Scarecrow is able to rescue both Dorothy and the prince.
Now queen, Dorothy has Kruel imprisoned. Having fallen in love with Kynd, she bids a fond farewell to the heartbroken Scarecrow. He has no time to dwell on his sorrow as the Tin Man comes after him. A plane piloted by Snowball swoops in to save him, but the Scarecrow falls—
And we cut back to the bedroom of the little girl, who wakes as the Toymaker finishes the story by saying Queen Dorothy and Prince Kynd lived happily ever after.