Bud Not Buddy is a story about a boy named Bud Caldwell, an orphan growing up during the Great Depression. After running away from his new foster parents after a fight with their son, Bud travels from place to place until deciding to travel to Grand Rapids to find Herman Calloway, a jazz musician he believes to be his father. Hitching a ride with Lefty Lewis, he arrives and meets the band, who eventually realize Bud is actually Herman's lost grandson.
Bud Caldwell is a ten-year-old orphan, living in Flint, Michigan, in 1936. Since the death of his mother four years earlier, Bud has been living in an orphanage and had short stints in several foster homes. The few items he has left of his mother include: a blanket, a bag of rocks, a photograph of his mother as a child, and fliers that show Herman E. Calloway and his jazz band, the Dusky Devastators of the Depression.
The story opens with Bud being placed with a new foster family, the Amoses. Bud soon meets Todd Amos, their 12-year-old son, who teases him mercilessly and calls him Buddy. After a fight with Todd, Bud is forced to spend the night in the garden shed. In the shed, Bud mistakes a hornet nest for a vampire bat and hits the nest with a rake. This upsets the hornets and Bud gets stung.
After escaping the shed, Bud takes revenge on Todd by making him look like he wet his bed (he did this by pouring water on Todd). He escapes and sleeps under a Christmas tree for the night. His friend Bugs wakes him up so they can go to the West.
Bud runs away with Bugs. They try to hop on a train, but only Bugs does. Bud starts walking to go to Grand Rapids, Michigan. On the way he meets Lefty Lewis who gives him a ride in his car to Grand Rapids to find his father, as he calls him, Herman E. Calloway.
Bud later discovers that Herman E. Calloway is his grandfather when he meets the band. The band treats Bud with kindness, but Herman treats Bud with great animosity. Bud delivers the news that Bud's mom, Angela, is dead. This brings great grief to Herman.
The story ends with Bud receiving a horn from the band, and Bud thinks he will have a bright future. It also ends with Bud finding out that the dead girl's room that he sleeps in, is his mother's room.