Set during World War II, 'Allo 'Allo tells the story of René Artois, a French café owner in the village of Nouvion (the town square scenes were filmed at Lynford Hall, Norfolk). The village has been occupied by the Germans, who have stolen all of its valuable artifacts. These include the first cuckoo clock ever made and a painting of The Fallen Madonna (known to those who have seen it as The Fallen Madonna with the Big Boobies) by Van Klomp. The commandant of the town has decided to keep them for himself after the war and gets René to hide the painting in his café. Hitler also wants the painting for himself, and sends Herr Otto Flick of the Gestapo to the town to find it. Flick, in turn, conspires to keep it for himself.

At the same time the café is being used as a safe house for two brave but clueless downed British airmen. René is forced to work with the Resistance, who would otherwise shoot him for serving Germans in his café. The far-fetched plans of the Resistance to get the airmen back to England, which always fail, are one of the main running gags of the series.