Gerald Clamson (Jerry Lewis) is a bank examiner who loves fishing on his annual two week holiday. Unfortunately one day at the ocean he reels in an injured gangster in a scuba diving suit named Syd Valentine (also play...展开ed by Lewis). Syd tells Gerald about diamonds he has stolen from the other gangsters and hands him a map. Gerald escapes as frogmen from a yacht machine gun the beach. They swim ashore and locate Syd where they machine gun him. Their leader Thor (Harold J. Stone) ensures Syd's demise by firing a torpedo from his yacht that goes ashore blowing a crater into the beach.
As the police ignore Gerald's story, Gerald heads to the Hilton Inn in San Diego where Syd claimed the diamonds were hidden. There he meets Suzie Cartwright (Susan Bay), an airline stewardess. While searching for the diamonds, he needs to avoid the hotel staff after inadvertently hurting the manager (Del Moore). Gerald disguises himself as a character noticeably similar to Professor Julius Kelp from The Nutty Professor, while trying to stay one step ahead of the other gangsters who are on his tail, as well as the hotel detectives led by the manager - all the while courting Suzie. As each of the gangsters see Gerald, an identical lookalike to the deceased Syd, they have nervous breakdowns; one imagining himself a dog, one turning into a Larry Fine lookalike, the other (Charlie Callas, in his usual character) becoming a hopeless stutterer. The one man Gerald meets the who believes him, who identifies himself as a FBI Special Agent, turns out to be an escapee from an insane asylum.
The movie climaxes in a chase through Sea World San Diego, where Gerald is pursued by Thor's gangsters, a rival group of gangsters who had made a deal with Syd to buy his diamonds, and a group of Chinese who smuggle the diamonds disguised as plastic pearls. Gerald disguises himself as a Kabuki dancer but is pursued until Suzie rescues him by flying by with a helicopter and dropping a rope ladder that Gerald escapes on. They return to the Pacific Ocean, where Syd reappears. The gangsters chase Syd into the ocean, and Gerald and Suzie walk away, deeply in love. The diamonds are never located.
The final scene shows the narrator, Frank De Vol, facing the camera and solemnly announcing that the tale is true—then the camera pulls back as De Vol turns and walks away on the breakwater where the beginning and ending action had taken place. De Vol is wearing all of a business suit except trousers, and he is carrying a briefcase.