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Harry Murray has rescued an old prospector, Rhodda, when almost perishing from thirst on the mid-Australian desert. Rhodda, in gratitude, promises the youth an interest in a rich claim he had located. But another man, Potosi Jim, knows of Rhodda's discovery and steals the rough map marking the precise spot. The shock of this act of theft kills Rhodda. Meanwhile Potosi Jim, already bent on jumping the gold claim, had dispatched his mate, Blaxland, to the city to get money to take up and develop the prospect. Blaxland brings to the gold fields Colonel Baylor, a mining speculator, previously acquainted with Potosi Jim, also a capitalist named Cuthbert, who is accompanied by his daughter, Hilda. By the same train arrives Jack Murray, owner of a sheep station, intending to bring his younger brother Harry home and away from the gold fields life. But Harry interests Jack in Rhodda's find, and the two brothers start out to seek it. Potosi Jim's party starts out later. All meet near the last stage to the sought-for claims. But Potosi Jim steals a march on the Murrays by stampeding their horses and secures possession of Rhodda's find. The brothers are indignant over the trick played, and believe that the Colonel is a confederate of the two rascals, Potosi Jim and Blaxland. Harry has fallen in love with Hilda, and is jealous because she defends the Colonel from such a charge. Mr. Cuthbert would willingly share the claim with Jack and Harry, but they refuse to be associated with Potosi Jim and ride further into the wilderness, prospecting. Here they discover the skeleton of a sailor who more than two hundred and fifty years before had wandered into the desert, and with the aid of an aboriginal boy had found alluvial or placer gold and accumulated a store of nuggets. The sailor had written his story on an old chart, whereby the Murrays are enabled to find both the hurried treasure and the placer gold. Meanwhile the Lone Star Claim, the name Potosi Jim gave to Rhodda's find, turns out to be small pocket of ore which cannot be profitably worked, but the outside world has heard rumors of the new Eldorado. From all parts of the world the gold seekers come. The new arrivals are grievously disappointed, and vent their anger on Potosi Jim and Blaxland, who have been concealing the truth about their claim with a view of selling out the property to the first unsuspecting buyer. But just when the trouble is reaching the head, Harry Murray arrives with the joyful news of free gold, and the crowd of miners streams away to the placer ground. Potosi Jim and Blaxland learn of the treasure found by the Murrays and steal the gold. But this time their villainy is exposed, partly by aid of the Colonel, and they are driven from the camp outcasts. The love between Harry and Hilda has gradually grown stronger through all these vicissitudes of fortune, and their engagement brings the story to a happy end.