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John Wayne, in the last of his Civil War characterizations, portrays Cord McNally, a Union Army colonel who loses a gold shipment in a Confederate raid, during which a devoted young officer is also killed. After the end of the war, McNally bears no ill-will toward the leaders of the raid, Pierre Cordona (Jorge Rivero) and Tuscarora Phillips (Christopher Mitchum), who were acting as soldiers, but he still wants the two unknown men on the Union side who they say sold them the information about the gold shipments. A year later, McNally crosses paths with one of the men, now a deputy from Rio Lobo, who is about to take Shasta Delaney (Jennifer O'Neill), a seemingly innocent young woman, out of a neighboring town at gunpoint. A shootout ensues, in which McNally's man and three other Rio Lobo deputies are killed, with help from Cordona -- this makes McNally very interested in what's going on in Rio Lobo, and he decides to go there with Cordona and Shasta. They find a whole community under siege from their own sheriff, a sadistic ex-outlaw named Hendricks (Mike Henry), and a mysterious landowner named Ketcham (Victor French), who showed up just after the war with a lot of money and hired guns behind him, forcing other landowners to sell their property and water rights to him. McNally and company keep their presence in town quiet, trying to help out Tuscarora Phillips, his beleaguered father (Jack Elam), and the other ranchers. Finally, they move against Ketcham and discover that he's the man that McNally wants, an ex-sergeant from his unit. Taking him captive, with the wild-eyed Mr. Phillips ever ready to cut him in half with a shotgun blast, they force Ketcham to sign back the property he's stolen -- but they're trapped in town by Hendricks and his men, who've taken Cordona prisoner. The attempt at an exchange of Ketcham for Cordona erupts in a bloodbath, complete with people being blown to bits and lots of wounding and maiming, before the outlaws are routed. The battle comes down to an injured McNally chasing an even more badly wounded Hendricks into the night, neither knowing which of their enemies may still be lurking in their path.