Marsa, a spirited, beautiful and wealthy young Parisian, is the illegitimate daughter of a gypsy mother and a Russian prince. At a young age, she becomes entangled in an affair with Count Menko, a married man, but later forgets this unhappy incident and falls in love with Prince Zilah of Hungary. When Count Menko threatens to give the prince certain compromising letters unless she agrees to resume their affair, she sets her wolfhounds on him, disfiguring him permanently. The letters are sent to Zilah on the night he and Marsa are married, and he immediately leaves her, causing her to go insane. Count Varhely, Prince Zilah's oldest friend, challenges Menko to a duel and kills him, after which he convinces the prince to forgive Marsa. At the sight of her husband, Marsa regains her sanity and leaves the sanitarium to live with him in Hungary.