In 1889, the inhabitants of Rejection are completely dependent on the income from a nearby silver mine. One day, a hot spring causes graboid eggs to hatch, resulting in the death of 17 miners. Hiram Gummer, great-grandfather of Burt Gummer (Michael Gross) and the mine's owner, arrives in town to fix the problem. After juvenile graboids that can shoot out of the ground (later dubbed Dirt Dragons) attack his camp one night, he is shocked by their presence. One of his companions, Juan, kills one with a pickaxe, and the pair escapes.
Inexperienced and not fond of firearms, Hiram calls for a gunfighter, Black Hand Kelly (Billy Drago). Hiram and Kelly do not get along well, though Kelly succeeds in conveying to Hiram some of his attitude towards firearms and life in general. Eventually, Kelly is eaten alive by a now fully grown graboid, but not before discovering that a total of four graboids have hatched. Hiram decides to abandon Rejection and leave the townsfolk to their fates. However, they force him to give them the silver mine, threatening to alert potential buyers to the danger if he sells it out from under them. In Carson City, Hiram receives a telegram revealing that the fully grown graboids have made it through the pass and are headed for the town. Changing his mind, he buys weapons with the last of his valuable belongings, heads back to Rejection to lead a last stand against the graboids, and helps the town ready itself.
After two graboids are killed, the third one adapts and avoids all of the traps. Hiram tricks it into coming to the surface and then attaches it by the tail to the flywheel of a steam traction engine. The graboid is reeled in and slammed against the front wheels and boiler with such force that it is explosively decapitated on impact. With the creatures dead, the town decides to keep them secret out of fear that no one would settle in the area if their existence were known, and use the proceeds from the mine to pay for their belongings. Hiram settles in Rejection (renamed Perfection), building his home in the same place where his great-grandson Burt's would one day be. He is also given a Colt 1865 Gatling gun and begins target practice, enjoying it.
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