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In the small town of Rathcullen, County Kerry, Ireland, Darby O'Gill is the aging caretaker of Lord Fitzpatrick's estate, where he lives in the nearby gatehouse with his lovely, almost grown, daughter Katie. Darby spends most of his time in the town pub, regaling his friends with tales of his attempts to catch the leprechauns, in particular, their king, Brian Connors. Darby is past his prime as a laborer, so Lord Fitzpatrick decides to retire him on half-pay and give him and Katie another cottage to live in, rent-free, and give his job to a young Dubliner named Michael McBride. Darby begs Michael not to tell Katie that he is being replaced, to which Michael reluctantly agrees. That very night, Darby is captured by the leprechauns while chasing Cleopatra, his runaway horse (who is actually a Pooka), on top of the fairy mountain Knocknasheega. Darby learns that King Brian has brought him into the mountain so that Darby can avoid the shameful admission to Katie about losing his job. However, Darby tricks the leprechauns into embarking on a fox hunt by playing "The Fox Chase" for them on a beautiful Stradivarius violin, loaned to him by King Brian. The leprechauns mount their tiny white horses and leave through a large crack in the mountainside wall, from which Darby escapes.
King Brian, angry for being made a fool of, comes to fetch Darby, and another battle of wits ensues over a jug of poitín. Darby traps King Brian by getting him so drunk that he does not notice the sunrise, which strips him of his powers until the next sunset. Trapped, Brian is forced to grant Darby three wishes before he can return home. Darby wisely makes his first wish be that King Brian not return to Knocknasheega, but to remain at his beck and call for a fortnight (two weeks), giving him time to think of two other, equally wise wishes. King Brian is furious, but forced to comply. The wily leprechaun king manages to trick Darby into (partially) wasting his second wish by appearing only as a rabbit in Darby's burlap sack, causing Darby unwittingly to say to Michael: "I wish you could see him [the King]". King Brian meets Darby halfway by appearing to both Michael and Katie in his true form in their dreams. Darby decides that he wants to use his third and last wish to ensure Katie's happiness. King Brian says to Darby that what Katie probably wants most of all is a "good, steady lad with temperate ways". Someone, in short, like Michael.
After a rocky beginning, Katie and Michael begin to show signs of growing affection for each other. Katie believes Michael is merely seasonal help, as her father could not bring himself to break the news of his retirement (and their imminent move). However, Michael has an arrogant rival in Pony Sugrue, the town bully with his eyes on both Katie and Michael's job.
Katie, angered at finding out the truth about her father's retirement from Pony's unpleasantly meddlesome mother, injures herself in a fall on Knocknasheega while trying to catch Cleopatra at night. The banshee appears, heralding Katie's death and sending the cóiste-bodhar, or Death Coach, a spectral coach driven by a dullahan, to carry her soul off to the land of the dead. Desperate, Darby elects to use his final wish to go in his daughter's place. King Brian is deeply saddened at Darby's wish, but grants it, but once Darby is on his way to the next world, King Brian reappears in the Death Coach and tricks Darby into making a final fourth wish ("wishing" that his friend could join him in the afterlife). Because he is only allowed three wishes, this negates all the previous wishes and spares Darby's life. Darby is saved and King Brian has (literally) the last laugh in their running battle of wits.
Katie's fever has broken and she and Michael reveal their love for each other. Michael also fights Pony Sugrue at the pub; getting his just revenge for Pony's attempt to get him fired by clubbing him on the head and pouring whiskey all over him to make him appear drunken and incompetent. Michael soundly thrashes Pony and knocks him cold. Finally, Darby and Michael depart arm-in-arm, joining Katie outside in the wagon for a happy ending, with Michael and Katie singing a final duet together of "Pretty Irish Girl".
- Albert Sharpe as Darby O'Gill
- Janet Munro as Katie O'Gill
- Sean Connery as Michael MacBride
- Jimmy O'Dea as King Brian
- Kieron Moore as Pony Sugrue
- Estelle Winwood as Sheelah Sugrue
- Walter Fitzgerald as Lord Fitzpatrick
- Denis O'Dea as Father Murphy
- Jack MacGowran as Phadrig Oge
- With the death of Kieron Moore (Pony Sugrue) on July 15, 2007, Sean Connery (Michael MacBride) is the film's last surviving cast member.
- This was the film that brought Sean Connery to the attention of Albert R. Broccoli, who then went on to cast Connery in his most famous role as James Bond in, Dr. No (1962).
- In the original release, there were numerous asides where the Irish characters would speak in Munster Irsh. Darby counts off "aon, dó, trí, ceathair" before playing the Fox Chase; several times King Brian rallies the hunt with a cry of "Ar aghaidh linn! (ahead with us!)" and so on. A later version had most of these lines redubbed in English.
- The leprechaun effects look very high tech and complicated, but most of them were achieved very simply by placing the "normal sized" actors closer to the camera than the "tiny" ones, and lining them up on the same horizontal plane through the lens so the distance between them could not be detected. This technique is known as "forced perspective."
- Walt Disney had seen Albert Sharpe in a stage production of "Finian's Rainbow" in the 1940s and kept him in mind for the role of Darby. By the time he began casting this film a decade later, Sharpe had retired. Disney was able to convince him to come out of retirement.
- The lighting used to make sure the actors were kept in proper perspective without seeming false used up so much electricity it apparently blew out a substation in Burbank when the lights were turned on without warning.
- The movie was released one year after the copyrights expired on the stories by Herminie Templeton Kavanagh.
- Walt Disney visited Ireland in December of 1948 and publicly announced the production of this film, then entitled simply, "The Little People". It would be another decade before the film was actually made.
- The film was released on a bill with the Donald Duck cartoon Donald in Mathmagic Land (1959).
- Walt Disney was initially hoping to cast Barry Fitzgerald in the dual roles of Darby O'Gill and King Brian. Fitzgerald reportedly declined due to his advanced age (although his eventual replacement as Darby, Albert Sharpe, was three years his senior). Disney regretted the loss of Fitzgerald in the lead role, and blamed the film's disappointing box-office performance partly on this loss.
- Walt Disney started planning for this movie in the 1940s. After World War II, Disney sent several artists to Ireland for background material.