RICHIE BLOOM is the only white kid on the block in the tough Stony Island neighborhood on Chicago's South Side. A sweetly naive 18 year-old guitar player, he dreams of putting together a band. RICHIE has the perfect musical collaborator in his best friend, KEVIN TUCKER, who has a voice second only to James Brown. RICHIE buys a used Les Paul electric guitar from JERRY DOMINO, the owner of a tropical fish emporium with a few "businesses" on the side.

PERCY PRICE is a local legend on the sax. The kids used to listen to him practicing at night when they were growing up. PERCY agrees to help RICHIE and KEVIN form a group, letting them practice at the local mortuary where he works. However, the owner, LEWIS MOSS, wants to sell the business to the local Alderman, who plans to turn it into a disco.

RICHIE, KEVIN and PERCY begin to put the band together, searching the city for horn players. RICHIE stumbles upon HAROLD TATE, a hillbilly sax player, while he and his mean uncle are washing windows at the music store where RICHIE works. But HAROLD's uncle yanks him away from an impromptu jam session before RICHIE can get his name or address. RICHIE scours the city to find the young wunderkind while conspiring with KEVIN to find HAROLD a horn to play.

The band starts coming together, and PERCY even manages to set up their first gig at the Burning Spear, a famous rhythm and blues institution where legend BB King often performs. However, annoyed with the music during a customer's funeral, ALDERMAN WALLER orders Mr. MOSS to fire PERCY and the group must find PERCY a new place to live and the band a new place to practice. Fortunately, JERRY DOMINO lets the kids use a rehearsal space above his tropical fish emporium.

While playing a beautiful solo during a rehearsal, PERCY has a heart attack and dies. Stunned by their mentor's death, the kids sadly take his body back to the mortuary for a courtesy funeral. However, Mr. MOSS informs them that PERCY'S insurance policy had lapsed, and callously demands they pay the funeral cost or take PERCY'S body to the County morgue. But MR. MOSS makes the mistake of calling RONNIE ROOSEVELT, a man listed as next-of-kin on PERCY'S lapsed insurance policy. RONNIE is a New Orleans piano man with a soulful voice and a voodoo attitude. He is outraged to learn that he was duped into coming to Chicago and he threatens Mr. MOSS with an especially unpleasant form of death.

When Mr. MOSS is found dead at his dining room table, the kids decide to take matters into their own hands. When KEVIN learns Mr. MOSS will be a closed casket ceremony, he and RICHIE switch PERCY's and Mr. MOSS' bodies, so that PERCY will receive the lavish funeral. That night the mortuary is filled with music and musicians as they celebrate PERCY'S life with a New Orleans style wake. Mr. MOSS's body ends up in the autopsy room of the County Morgue.

The Stony Island Band's debut is a smash. The evening is dedicated to PERCY, whose spirit arrives just in time to finish the solo he was playing when he died.