Long ago, a young Plains warrior is tested by being the target of three different weapons.Centuries later, Ernest P. Worrell (Jim Varney) is a dim-witted redneck who works as a maintenance man at Kamp Kikakee but hopes to become a counselor. He quickly becomes a valuable addition to the staff, skilled at Plains Indian Sign Language, used by Kikakee's owner, Chief St. Cloud ('Iron Eyes' Cody).A small group of juvenile delinquents, the Second Chancers, come to Kikakee. Head Counselor Tipton (Larry Black) assigns Kikakee's most experienced counselor, Ross Stennis, to be the boys' counselor. Stennis is unhappy with this, and he treats the boys harshly. After he goes too far by intentionally causing Moustafa Jones, the smallest boy in the group, to nearly drown in the lake during swimming, only for Moustafa to be rescued by Ernest, the boys retaliate against Stennis' cruelness by toppling his lifeguard perch into the lake, badly injuring Stennis' leg in the process. With Stennis no longer able to perform his duties as a counselor, and Kikakee already shorthanded, Tipton offers Stennis' position to Ernest.The Second Chancers initially give Ernest trouble, but they start to show respect during a campfire session when Nurse St. Cloud (Victoria Racimo) translates her grandfather's description of the warrior initiation ritual for his tribe. The initiate must hold still while a knife, a stone hatchet, and an arrow are thrown or shot at him. The courage of the young warrior apparently alters the course of each weapon to prevent it from striking. The Second Chancers build a tepee only to find it burned. They fight Pennington, one of the regular campers, because he was responsible. Tipton is poised to expel them, but Ernest convinces him otherwise.Meanwhile, an evil mining corporation run by Sherman Krader (John Vernon) wants the petrocite at Kikakee. Chief St. Cloud refuses to sell. Krader manipulates Ernest into obtaining the chief's signature. Using Ernest as an interpreter, St. Cloud signs the land away. Tipton sadly announces that the camp must close. Nurse St. Cloud confronts Ernest, who stammers that he will fix the situation.Ernest and the Second Chancers storm into the construction site and demand the boss. Krader is not present, but the foreman, Bronk, beats up Ernest, who goes away alone. Later, Nurse St. Cloud overhears the kids demeaning Ernest's effort, so she reveals that Ernest is the only person who has defended them. They resolve to find him and apologize.Krader is poised to demolish Kikakee, and while the regular staff and campers are sent home, Ernest and the Second Chancers decide to risk openly attacking the construction site to stall for time. They are joined by Chief St. Cloud, chefs Jake and Eddie, and former camper rivals, Pennington and Brooks.The group improvises some non-lethal weapons. Chief St. Cloud arrives to bless the fighters, though Nurse St. Cloud begs them not to go through with it. The assault quickly cripples the construction site's equipment. However, the foreman escapes in a bulldozer and destroys several camp buildings. The group stops him with Ernest's motorized maintenance cart filled with explosives. Ernest then knocks out Bronk.Krader arrives with his lawyer. He targets Ernest with his hunting rifle. Echoing Kikakee's ancient testimonial pow wow, Ernest faces down Krader and apparently passes the test as Krader takes three shots at him, missing every time. Ernest then plugs Krader's hunting rifle with his finger and laughs in his face, signaling his defeat. Krader's lawyer says Krader has finally encountered a force too powerful for him. As Krader retreats, Nurse St. Cloud returns with an injunction against the demolition.Later, Kamp Kikakee is operational with all campers and a full staff. Nurse St. Cloud thanks Ernest for all he has done, and reveals Krader was arrested for fraud. Chief St. Cloud now seems to understand English, and Ernest is a full-fledged counselor. When trying to rebuild the Kamp Kikakee sign, Ernest falls and is knocked out.