The Kolathiri Raja (Thikkurisi Sukumaran Nair) is a prosperous ruler of Northern Kerala. Prince Udayan (Prem Nazir), Raja's nephew, is handsome, brave and intelligent than Devan (Madhu), Raja's elder nephew. The King named Udayan as his successor to the throne along with marriage of his daughter Princess Parvathi (Lakshmi), who was in deep love with Udayan. This has dashed the hopes of Devan, who secretly admired and longed to marry Parvathi.

On the other hand, 2 nobles of court, Kammaran (Mammootty) and Perumana Kurup (N. Govindan Kutty) were upset by Udayan's ascension. Cashing on Devan's frustrations, Kammaran made Devan against Prince Udayan. For this, Kammaran used Kompan Dacoits, who were frequent raiders in many villages, to stage a royal pardon, sought presence of Prince Udayan in his position as Crown Prince for signing the peace treaty. Without knowing as a honey trap laid by Kammaran and Kurup, Udayan drove to Kompan's camp, only to fall in the trap laid. However, news flashed in the country as Prince Udayan betrayed Kolathiri Raja and killed some of the Raja's men. This made the Raja furious, who declared Udayan as a traitor and cancelled the marriage.