Mehmene Banu, the ruler an Oriental city, promises a large award to anyone who would cure her terminally sick sister Shirin. A Stranger comes forward and offers to save the girl on two conditions: that Mehmene would have a gold and marble palace built and she would give up her extraordinary beauty. The conditions are grated and Shirin is saved. The artist Ferhad is commissioned to decorate the newly built palace. Both sisters fall in love with him, but he reciprocates his feelings with Shirin. The lovers decide to escape from Mehmene's ire, but are caught. The ruler promises Ferhad Shirin I his freedom if he manages to break down the rocks of an iron mountain blocking a stream of clear water. Ferhad takes the challenge. The sound of his hammer inspires hope in the people languishing without water in the thirst and disease city. The years later, Mehmene allows her sister to bring back her lover but he is determined to complete his undertaking.