As described in a film magazine, Sara Crewe (Pickford) is treated as a little princess at the Minchin boarding school for children until it is learned that her father has lost his entire fortune, and she is made a slavey (a household servant). She and Becky (Pitts), another slavey, become close friends who share their joys and sorrows. Christmastime draws near and the girls watch the preparations wistfully. Their loneliness arouses the sympathy of a servant of the rich Mr. Carrisford. On the night before Christmas he prepares a spread for the slaveys in their attic. He calls his master Mr. Carrisford (von Seyffertitz) to watch their joy, but both are witness to the slaveys being abused and whipped by Miss Minchin (Griffith). Carrisford interferes and learns that Sara is the daughter of his best friend. He adopts Sara and Becky and in their new home they have a real Christmas.
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