Railway agent Mike Flannery wants to charge the livestock rate for a shipment of two guinea pigs and refuses to accept the lower pet rate, saying "pigs is pigs." Flannery believes that the "guinea" is an indication of the pigs' national origin. He argues that they should bear the higher freight charge of 30¢ for livestock, rather than the lower 25¢ for domestic pets. In support of this, he submits that if they were "dago pigs" or "paddy pigs", there would be no question of the animals' status.

Because the customer refuses to accept delivery, Flannery is forced to feed and house what he now calls the "dago pigs" in his office, until he receives permission from his superiors to return the pigs to the company warehouse. By this time, the guinea pigs have reproduced geometrically in Flannery's station house. After returning all the descendants, Flannery resolves to charge the lower rate for any future livestock.

The story is credited by Robert A. Heinlein as possibly the origin of the flat cats in his novel The Rolling Stones, since he may have read it or heard it as a child, but due to the intervening time he could not be sure. The concept obviously had some currency because it also shows up in the famous Star Trek episode "The Trouble with Tribbles".

The story was made into movie form several times, including the Walt Disney cartoon in 1954 that was nominated for an Academy Award for Animated Short Film.

The 1937 Merrie Melodies cartoon, directed by Friz Freleng, is not an adaptation of the Butler story, though it shares its title.