For his birthday, Emperor Louis offers a reward to the tailor who designs the finest outfit for him to wear for his upcoming celebration. Two swindlers, posing as tailors, convince the Emperor to wear a special design which uses a fabric which they claim to be visible only to the wise; fools will not be able to see it.

Not wanting to be a fool, no one is willing to admit that the Emperor is parading in just his underwear - no one except for one truthful child... The embarrassed Emperor catches the swindlers and continues the party...