 The Emperor is leading an empty life, surrounded by marionettes with no will of their own. He attempts to stave off his boredom with luxury and uses all his energy - and the money of his subjects - to have new collections of fashionable clothes designed for him repeatedly. Every week his court tailor, Lorenzo, has to present the latest creations to him. But Lorenzo is starting to run out of ideas. The Emperor s subjects have very different problems meanwhile. Taxes are being levied in an increasingly exorbitant manner. A new law dictates that each citizen has to buy a new coloured badge, or "clothing token", at a high price. Anyone caught without one will be subject to imprisonment and hard labour. Tobias, a twelve-year-old orphan, quick-witted and cheeky, earns his living by stealing clothing tokens from the rich and selling them on the black market. One fine day, Lorenzo falls victim to our young thief. The whole thing nearly turns out badly for little Tobias, however: a young weaver named Maria and her little daughter Jenny are arrested in the middle of the market square because they cannot afford a new clothing token. Tobias, who has observed this scene and is enchanted by the beauty of the young mother, generously offers her the clothing token that he has just stolen from Lorenzo. Lorenzo witnesses this, however; he identifies the young thief and calls out for the police. He regrets this the very next moment, however, because he has caught sight of Maria too, and is instantly captivated by her beauty. A tumult ensues. Lorenzo tries to stop Maria from being placed under arrest, but to no avail. With a guilty conscience now because of his rash behaviour, he tries to at least help the boy. Without further ado, he takes Tobias back to the palace with him. There he dresses the boy in new clothes and gives him a job as page. Tobias, who so far has only been acquainted with hunger and need, is initially rather suspicious of the decadence of life at court. But the boy gradually grows to trust Lorenzo, who treats him with almost paternal affection. Lorenzo finally admits to Tobias that he has fallen in love with Maria, who is having to work very hard in the royal weaving mill. While Tobias is now facing a whole new world, Lorenzo s prospects appear increasingly gloomy. He knows that he will have to think of something extraordinary, something entirely new, if he is to remain in his ruler s favour. At this point it is Tobias who comes to the rescue. In his childish naive way he suggests they dress the Emperor in rags. Lorenzo is instantly taken by this idea. The new collection would be something entirely without precedent - fashionable rags for the Emperor! At the fashion show, the Emperor and the court are speechless for a moment. Torn jackets, ragged clothing, shirts full of holes - it s an unaccustomed sight. The Emperor likes the collection, though. He even tries on one of the ragged jackets. But then something unfortunate occurs: the jacket sleeve was not sewn on properly and it gets torn off. A breathless hush descends among all those present. Lorenzo and Tobias go cold with fear. The Emperor is absolutely enchanted by the mishap, however, and orders his court to follow suit immediately, and each tear off an arm of their jackets as well. While the courtiers are dutifully obeying this last command, the whole thing becomes too much for Lorenzo: a one-armed jacket is an insult to his honour as a tailor. For the very first time in his career, Lorenzo dares contradict the Emperor. His ruler issues a harsh ultimatum, however: either Lorenzo does what everyone else does, or he will be exiled from the court. Tobias and Lorenzo confer in despair. With a heavy heart, they finally make up their minds to go into exile. They no longer wish to subject themselves to the Emperor s tyranny. Solitary and penniless, they travel across the land, both harbouring a burning desire to expose their unjust ruler. They re also very concerned about the fate of Maria and Jenny. There must be some way of freeing the two of them. And then one day, they have a brilliant idea... Lorenzo puts on an artificial beard and dresses up as a foreign weaver, and Tobias dresses as a girl - with much reluctance, naturally. In this way they manage to slip back to the court unrecognised. They then succeed in obtaining an audience with the Emperor. Lorenzo announces to the Emperor that he is an artist of extraordinary skill. The clothing he weaves has a miraculous attribute: it cannot actually be seen by anyone who is stupid or incompetent. The Emperor senses a unique opportunity here to weed out all the unsuitable members of his court. He thus gives the two mysterious weavers a free hand. "The Emperor s New Clothes" are to be ready in thirty days  time. The two pretend to set to work busily, spinning thread very theatrically and weaving invisible material. While the Emperor waits excitedly for his clothes, Tobias, in disguise, secretly makes contact with Maria. When Maria is released soon afterwards she moves in with the mysterious weavers. Meanwhile the Emperor is still impatiently awaiting the result of the foreigners  labours. Finally he cannot restrain his curiosity any longer, and he sends his two closest confidants to Lorenzo so that they can give him their appraisal of the clothing. Neither of them can see anything, of course. However, they are worried about telling the Emperor this, so instead when they get back they portray the non-existent material in very florid terms. The Emperor is satisfied. At least these two seem to be good at their jobs. On the day of the great fashion parade the Emperor can restrain his inquisitiveness no longer. As the entire court assembles, slowly and expectantly, he goes to Lorenzo and Tobias in order to make his own personal appraisal of the clothes, and sees... nothing! At that moment Tobias loses his girl s wig and the Emperor recognises the young boy. Now that they have nothing more to lose, Lorenzo decides instead to take the bull by the horns, and he tears off his artificial beard. The Emperor reacts unexpectedly: standing there exposed, he realises how vain he has been, and forgives the two of them for tricking him. And that s not all: he insists on appearing before his people without any clothes on, as a kind of punishment for his own stupidity. When the Emperor finally appears in front of his court, a murmur runs through the ranks. Since no-one wants to be shown up, a brief moment of hesitation is followed by thunderous applause. Maria and Jenny are also among the onlookers. When the little girl sees the Emperor she tells the truth quite innocently: "But the Emperor s got nothing on!" At this point the Emperor gives an ardent speech in which he confesses that his eyes have been finally opened. From now on the Emperor becomes a kind and just ruler. His greedy aunt is banned from the court, and peace and prosperity finally prevail. Lorenzo, Maria, Tobias and Jenny become one big happy family.