Two years after his release from Camp Green Lake, Theodore "Armpit" Johnson is living in Austin, Texas trying to build a stable lifestyle by digging deep holes 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 because a couple of her friends had said bad things about him although she did not mention this to his face, so Armpit decides to take Ginny instead. When the remaining tickets are discovered to be counterfeit, Armpit is beaten and handcuffed by the police while Ginny has a seizure. Luckily, the mayor of the city—who remembers Armpit from the landscaping work he 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. A couple days later Kaira and Armpit meet up for breakfast in the four seasons hotel. They go outside and Kaira tries to guess what Armpit's nickname is. He said that if he told her she would have to touch that body part that was his nickname. He tells her and then she touches his armpit.
The next day, X-Ray 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 Department questions 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 Francisco by Kaira; but is accosted by ticket sellers Felix and Moses, who beat X-Ray and threaten to expose both of them to the police unless Armpit gives them the letter that Kaira sent earlier. Having agreed to do so, Armpit meets Kaira in San Francisco. In a coffee shop on the Italian part of San Francisco called North Beach, 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, then storming away.
Meanwhile, Kaira's business manager and stepfather, Jerome "El Genius" Paisley, plots to kill Kaira and frame Armpit for the murder. Jerome is jealous and angry because Kaira plans to fire him when she turns eighteen, in two months. Jerome enters Kaira's room and attacks her with a metal bat, which was the same one that he showed Armpit earlier. Although she ends up unconscious and seriously hurt, Kaira survives, after Armpit and Fred (her bodyguard) stop Jerome. Jerome goes to jail. Kaira later recovers, though is told she may not be able to 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 is put in jail, but Kaira's money is never recovered, leaving Kaira broke.
Armpit arrives home and is visited one last time by Detective Newberg. She reveals that she knows Armpit bought the tickets from X-Ray, but that she is closing the case. Later on, Armpit hears Kaira on the radio singing about her and Armpit's relationship, accompanied only by a piano. 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...