Elwood P. Dowd (James Stewart) is a grown man with an imaginary friend, Harvey. However, Elwood is convinced he is real and doesn't understand why no one else can see him. Oh, and this imaginary friend, Harvey, is a rabbit as tall as Elwood. Naturally concerned by the conversations Elwood has with Harvey, his sister Josephine Hull (Veta Lousie Simmons) has doctors over to the house to observe her brother's behavior. They recommend that Elwood be committed to an insane asylum. Yet the doctors are no match for the wit and wisdom of Harvey as Elwood reports his brilliant retorts to the doctor's questions. Elwood is harmless and Harvey has such sage advise for how to treat others with kindness and without prejudice, the doctors are the ones left looking crazy.