Lootera is an adaptation of O. Henry's The Last Leaf.[7] In the picturesque town of Manikpur (West Bengal) of 1953, the zamindar goes to watch a Chhau dance along with his daughter, Pakhi Roy Chaudhary, an aspiring writer. After Pakhi has an asthma attack from the ensuing excitement, she is rushed home and is given medication. As she recuperates, her father comforts her and narrates the story of the invincible king whose soul resided inside a parrot, and then proceeds to tell her that she is the parrot within whom his life resides.
One day while learning to drive a car, Pakhi accidentally bumps into a motorcycle and mildly injures a handsome youth. While he is being treated, Pakhi gets drawn towards him. A few days later, the same youth introduces himself to the zamindar as Varun Shrivastav, an archaeologist who needs to study the land surrounding the temple owned by the zamindar. Over the next few weeks, Varun charms the zamindar and his daughter with his knowledge and persona, and is invited along with his assistant, to live at their home.
Soon, love brews between Varun and Pakhi as they bond over art and literature, and their love culminates into a passionate affair. Meanwhile, an act passed by the Indian government debars the powers of zamindars causing tension in the Chaudhary household.
As Varun's stay comes to an end, he proposes to Pakhi and preparations of their wedding begin thereafter. But on the wedding day, Varun is nowhere to be found, and it is discovered that the idols from the temple have been stolen and the currency notes from the purchase of the family's artifacts (arranged by Varun), turn out to be counterfeit.
A year later, Pakhi is living all alone in Dalhousie. Her father has passed away and she has still not recovered from her heartbreak. When a police inspector asks her in helping him nab Varun, she refuses to do so. Soon after that, Varun and his friend turn up at Dalhousie for their next heist and coincidentally stay at a lodge on Pakhi's property. Things turn ugly when the police gets wind of their whereabouts and a chase ensues. After Varun accidentally kills his friend along with a constable, he seeks refuge in Pakhi's house.
Although Pakhi does not turn him over to the police, she is nevertheless enraged and repels Varun's comforting advances and explanation. In a letter, she explains to Varun that she is dying of tuberculosis and will pass away the day the last leaf falls from the wilting tree outside the window.
Varun then plans his escape but refuses to go and takes care of the ailing Pakhi instead. Soon Pakhi warms up to him and her faith remains intact when each day she finds one last leaf remaining on the tree.
Eventually, it is revealed that apart from taking care of Pakhi, he also used to paint a leaf and tie it on a branch of the tree everyday so that she doesn't give up hope. In the end, as he is about to escape, Varun is shot down by the police while Pakhi realizes everything after she looks at the painted leaf closely and smiles with tears in her eyes