Gotham City is caught in the throes of a massive gang war between Arnold Stromwell and Rupert Thorne. Commissioner Gordon seems to feel that Stromwell will soon be retiring as the mob violence escalates. In his palatial estate, Stromwell disagrees with Gordon's prediction, but things may be taking a turn for the worse for the crime lord, since his only son, Joseph, has been reported missing. Stromwell decides that he wants to put an end to this war and sets up a meeting with Thorne for that night. Stromwell's convinced that Thorne has taken his son away.
Thorne and his henchmen are gathered around a table in the near-empty Italian diner, Pete's. As they start their meeting, the barkeep helps an old sleeping man up from his table. As the man reaches for his walking cane, his hand darts beneath the table and leaves something there. No one notices, and the man is shuffled out the door. Thorne tells his men about the meeting with Stromwell, and fills them in on his plan. He wants Stromwell to feel they can work towards a truce, but in reality Thorne plans on killing him. Things won't go quite as planned, however, because the object the old man left behind was a listening device, and the old man is really Batman, listening to the conversation from the Batmobile outside!
Later that night, Stromwell and his men head towards the diner for the meeting. On the way, they are stopped at a railroad crossing, and Stromwell recalls a night long ago. He and a boy named Mike are walking alongside a set of railroad tracks, and Mike admonishes Arnold for constantly stealing junk, warning him that one day he's going to get caught. Arnold is confident that he'll own the town one day, and so isn't worried about the consequences of his thefts. Their argument is cut short as a train suddenly announces its presence. Mike races off the track, but Arnold's foot gets caught and he can't break free. Just before the train reaches him, he manages to break his foot loose and jumps off the track. He seems to be safe, but then notices that in all the commotion he and Mike didn't notice the second train! Before we see the flashback reach its conclusion, the train passes and Stromwell returns to his senses.
Elsewhere in Gotham City, Batman enters a church and confronts the Father, informing him that Stromwell is going to need him tonight. "That's one soul I wish I could give up on," the Father mutters. "I don't believe you'd give up on anyone, Father," Batman replies, and the Father looks away, knowing it's true.
Stromwell arrives at Pete's, and Thorne insists that they speak alone. All the henchmen head outside. Thorne makes mention of the news report regarding the mob war, and Stromwell instantly turns hostile, demanding to know where his son is. He grabs Thorne and starts tossing him around the restaurant. Thorne insists that he didn't touch Stromwell's family, and calms his rival down. He then tells Pete to send some food out, and heads toward the back of the diner. Stromwell suspects a trap, but it's too late! Thorne cuts the lights as he heads out and Stromwell jumps to his feet to find a way out. Instead, he finds Batman.
Outside, Thorne's men scurry off just as the diner explodes, catching Stromwell's men in the backwash. The stunned thugs realize they can't help Stromwell now, and they drive off before the cops arrive. Thorne gathers his men and takes off, victorious. Meanwhile, in the back of the diner, Batman kicks open the door and carries an unconscious Stromwell up to the rooftops. A bystander in the gathering crowd of onlookers happens to look up on the rooftops and sees Batman racing away with Stromwell on his back. Back at the diner, the police and fire department have arrived on the scene. The lead fireman reports to Gordon that they couldn't find evidence of anybody inside the restaurant, and the onlooker approaches to inform Gordon about his Batman sighting. Another face in the crowd, one of Thorne's henchmen, hears this and slinks off to report to his boss. Thorn dispatches his men to scour the streets and to find Batman and Stromwell.
High above Gotham, Batman informs Stromwell that the only reason he saved him was to get information about the gangs. Not surprisingly, Stromwell doesn't want to tell him anything. Batman takes him down to the streets, and Stromwell recognizes the area as where he first started in the crime business. Batman knows that Stromwell used to sell drugs and now manufactures them, but Stromwell won't admit to it. "Nobody twists anybody's arm to take them, you know," he tells Batman. "And for the record, I make candy." Batman grabs the crime lord and drags him into the Sunrise Foundation, a drug rehab center. Here Stromwell is confronted with a painful realization: his son has become hooked on the very drugs he manufactures! His ex-wife Connie is in the room with his son, and reminds him that the reason she left him was because of the life Stromwell was leaving, and now his son has become a casualty on this life. Batman asks Stromwell to help him stop this madness before more people are hurt.
Stromwell takes Batman to a building by the railroad where he keeps his records. Batman, however, quickly discovers that these records are fake, but Stromwell has taken the moment of distraction to arm himself! To make matters even worse, Throne's men have managed to track them down. Before Stromwell can get away, a canister of tear gas is flung through the window. Batman breaks a second window to help vent the gas and then prepares himself to dispatch Thorne's goons. In the confusion, Stromwell staggers out of the building and heads into the train yard. His escape doesn't go completely unnoticed, however, and Thorne's goons flee from Batman's hunting ground in pursuit. Batman follows along and begins to eliminate the henchmen.
Meanwhile, Stromwell runs into the Father, who has been waiting for him by the tracks from Stromwell's flashback. The crime lord once again begins to remember that fateful day from long ago. He recalls that Mike had pushed him from the path of the second train, and as a result had been hit by it. It's also revealed that the Father is actually that little boy and he is also Stromwell's brother, and he eagerly wants to help his brother through this difficult time. Stromwell refuses to accept his aid. "Last time you helped me, it cost you your leg." Michael refuses to give up, however. "Now you've got a chance to save yourself. Do the right thing for yourself, for your son, for me, your little brother." Stromwell finally relents, and gives his brother an emotional hug. Thorne arrives to cut the reunion short, but Batman shows up on the scene as well and knocks Thorne to the ground. He then races off into the night as the police arrive, but Stromwell remains standing with his brother to turn himself in to the police.