The Duke of Caprona lives with his wife the Duchess in a large palace in the middle of the town. The palace is very old, but protagonist Tonino Montana has never been there until his first visit as part of an emergency family delegation.
However, Tonino has met the Duke before -- once when he was watching a Punch and Judy show in the street outside the Palace, he noticed a strange eager man with a damp-looking face and expensive-looking clothing among the crowd watching the show. The man laughs very loud at every joke, and the jewels on his shoes and in his necktie pin glimmer and sparkle in the light. Tonino thinks of him as 'Mr. Glister' and decides he must be an amiable lunatic of some kind. When servants search him out in the crowd and lead him away calling him 'your Grace', Tonino decides they must be humoring his lunacy.
However, when the Montana and Petrocchi families are called to the palace as part of a delegation to discuss how to protect the town amid the growing unrest all around them in Italy, Tonino is introduced to both the Duchess and the Duke, and he immediately realizes that Mr. Glister actually was the Duke of Caprona. And in this meeting, he seems the very same way he was out in the street watching the puppet show -- obsessed with theater and puppets and somehow absent-minded as well.
Things continue to go badly for the Montanas and for Caprona, and the next time Tonino meets the Duke, he discovers that there's more to him than meets the eye -- more sad awareness of what is going on around him, more kindness, and more cunning when it comes to evading the same forces that are threatening both the children and the town of Caprona. He turns out to be an ally and a friend, and not the fool he seems to be at all.