The film concerns the kidnapping of a Swiss scientist by their nemesis Professor Moriarty, to steal a new bomb sight and sell it to Nazi Germany.

[2] Sherlock Holmes (Basil Rathbone) pretends to be a Nazi spy to aid scientist Dr. Franz Tobel (William Post Jr.) and his new invention, a bombsight, in escaping a Gestapo trap in Switzerland.

The scientist slips away against Holmes' instructions for a secret reunion with his fiancee, Charlotte Eberli (Kaaren Verne), and gives her an envelope containing a coded message.

Holmes is put into the false bottom of a sea chest, but is rescued when Watson and Lestrade observe the henchmen struggling with its unusual weight.

He finds impressions of the message left on a notepad page by immersing it in "fluorescent salts... and then photograph(ing) it by ultraviolet light."

Holmes deduces the change in the code and breaks the fourth line, identifying the scientist as Professor Frederick Hoffner (Henry Victor).

Unknown to Moriarty, Holmes had the real Hoffner attach an apparatus to their car that drips luminous paint (which Watson helped prepare) at regular intervals.

When he attempts to complete his escape through a secret passageway, he falls sixty feet to his death; Holmes has discovered the criminal's hidden trap door and left it open.