In 1933, Annie, a young orphan living in the Hudson Street Orphanage in New York City, thinks that her parents simply left her there. Annie attempts to flee to find her parents, but the orphanage's cruel and alcoholic supervisor Agatha Hannigan catches her and orders the orphans to clean up the orphanage. Later, while trying to flee in a laundry truck, Annie befriends a dog and later names him Sandy after convincing the dogcatcher that he is hers. Escorted back to the orphanage along with Sandy, Annie is to be penalized and Sandy is to be sent to the sausage factory. However, Grace Farrell, a secretary to billionaire Oliver Warbucks, arrives, saying that he wants an orphan stay at his mansion for a week to help his image. Despite Hannigan's objections, Grace picks Annie and rescues Sandy.
Upon arrival, Annie, Sandy, and Grace meet Warbucks' bodyguards Punjab and The Asp among the other butlers, maids and servants including Cecile, Drake, Mrs. Pugh, Mrs. Greer, Annette, and Saunders. During her stay there, she quickly endears herself to everyone there.. However, Warbucks disapproves, as he originally desired a boy orphan. Meanwile, Hannigan, frustrated with the orphans' behavior, is visited by her brother Rooster and his girlfriend Lily.
Annie eventually gains Warbucks' trust. When Sandy detects an assassin who tries to kill Warbucks with a bomb, it is thwarted by Sandy, Punjab, and The Asp. Grace explains to her that the Bolsheviks are displeased that he is living proof that the Capitalist system actually works. After visiting a movie theater, Warbucks and Grace put the orphan to sleep. Convinced by Grace to adopt her, Warbucks goes to the orphanage to get the adoption papers signed. Despite Hannigan's attempt to seduce him, Warbucks blackmails her into signing. He goes back to the mansion to tell Annie and is about to give a Tiffany's locket to her, but the orphan says she wants to find her real parents. Deciding to help, Warbucks makes an announcement on a radio show hosted by Bert Healy offering a $50,000 reward to her parents.
A crowd of would-be 'parents' arrives at Warbucks' mansion. Warbucks and Punjab take Annie in the auto-copter to visit President Franklin D. Roosevelt in Washington DC, where she performs for him and his wife Eleanor. When Annie learns that the search for her parents has not been successful, Warbucks convinces her not to give up. Meanwhile, the Hannigans and Lily plot a scheme using their disguises to collect the reward, drown Annie and split the money three ways. Hearing what has happened, the other orphans attempt to go to Warbucks' mansion but are locked up by the Hannigans and Lily. The orphans flee and find out that the Hannigans have captured Annie and the money. Hearing the orphans' warning, Warbucks puts out an APB on the felons, and he and Grace search for them while Punjab and another servant search from the auto-copter, ending at a railway drawbridge that is in the upright position. Annie destroys the check and Rooster pursues her to the bridge in an attempt to kill her over his sister's objections. As the police, firefighters, and ambulance arrive with Warbucks, Punjab kicks Rooster into a firefighter's net and rescues Annie. Rooster and Lily are arrested and Annie gets her wish of a good family at a party where President and Mrs. Roosevelt, her orphan friends, and the servants are enjoying themselves. Hannigan is reformed and Grace and Warbucks further develop their relationship.
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