Two years after his release from Camp Green Lake, Theodore "Armpit" Johnson is living inAustin, Texas trying to build a stable lifestyle by digging trenches and caring for his neighbor Ginny McDonald, a ten-year-old girl with cerebral palsy. While working at the mayor's home, he is approached by Rex "X-Ray" Washburn, one of his friends from Camp Green Lake, who wants Armpit to loan him money for a ticket scalping scheme for an upcoming concert by teen pop star Kaira DeLeon. Armpit agrees, and at first the scheme seems to go as planned.
He asks X-Ray to give him the last two tickets to the concert, so he can take Tatiana, the girl he admires in his summer class on a date. At first X-Ray is unwilling because he already has a buyer for the tickets, but eventually he agrees to give them to Armpit.
Later, Tatiana says she would be unable to come to the concert, and Armpit decides to take Ginny, the girl who lived right next door to him and has cerebral palsy, instead. When the remaining tickets are discovered to becounterfeit, Armpit is beaten and handcuffed by the police while Ginny has a seizure. Here, the mayor - who remembers Armpit from the landscaping work Armpit did for her - intervenes; and singer Kaira DeLeon, upon discovering the situation, invites Armpit and Ginny to watch her from backstage. After the concert, they join her to share ice cream.
The next day, X-Ray visits Armpit, and reveals that he had made the counterfeit tickets, selling the genuine ones to the buyer. He gives Armpit the money gained by selling the missing genuine tickets. After a few days, Armpit receives a love letter from Kaira DeLeon.
Some time afterward, Detective Debbie Newberg of the Austin Police Departmentquestions Armpit about the counterfeit tickets; where upon Armpit invents a culprit to avert suspicion from himself and X-Ray.
Later still, Armpit is invited to San Franciscoby Kaira; but is accosted by ticket sellers Felix and Moses, who beat X-Ray and threaten to expose both boys to the police unless Armpit gives them the letter that Kaira sent earlier. Having agreed to do so, Armpit meets Kaira in San Francisco. He tries to explain the counterfeit tickets and how he has to sell her love letter. He asks her if she will write another love letter, so he can sell it. Kaira believes Armpit is after her money and does not care about her as a person. This results in an argument which ends by Kaira throwing coffee all over Armpit [this was set in China Town], then storming away. Meanwhile, her business manager Jerome "El Genius" Paisley, Kaira's step-father and manager, plots to kill Kaira and frame Armpit for the murder; but is prevented by Armpit. Jerome is jealous and angry because Kaira plans to fire him when she turns eighteen, in two months. Jerome attacks Kaira in her room with an extra room key and although she ends up seriously hurt and unconscious, she survives. Armpit suffered a broken arm in the fight and Fred, Kaira's bodyguard is severely hurt as well, and having tried to save Kaira from getting hurt, he got stabbed. Jerome goes to jail. Kaira later recovers, though is told she cannot sing again. Also, it is discovered that Aileen, Kaira's mother's best friend had stolen almost all of the money in Kaira's trust account. Aileen was put in jail, but Kaira's money was never discovered. This meant that Kaira had hardly any money left and was broke.
Armpit arrives home and is visited one last time by Detective Newberg. She informs him that this case of counterfeit tickets is closing. She also informs him she knows the truth, because she put 2 and 2 together and got 4. Later on, Armpit hears Kaira is still able to sing, albeit weakly. She sings a song accompanied only by a piano about her and Armpit's relationship. Armpit is touched by this. He accepts his life can't revolve around Kaira DeLeon and decides to continue with his plan of taking small steps towards making a better life for himself.