This book, along with Starship Troopers, shows Heinlein uneasily evolving away from his old, comfortable territory of juvenile SF novels. Both books were written for a publisher expecting to market a juvenile SF novel, and both raised serious objections from the publisher.
The book is a first-person narrative in the form of Podkayne's diaries. Due to the unscheduled "uncorking" of their three test-tube babies, Podkayne's parents remain behind while she (about 17 Earth years old) and her brother Clark (about 11) take a planned trip to Earth. Stuck with changing diapers rather than partners on the dance floor, Podkayne confesses her misery to their uncle, Senator Tom Fries, an elder statesman of the planetary government. The mistake proves to have a silver lining. Podkayne and Clark watch as Tom Fries meet with the creche officials, and the officials state they will upgrade the Fries' passage to a luxury liner, with Senator Fries to chaperone the two children. Prior to boarding, Clark is asked by a customs official "Anything to declare?" and facetiously answers "Two kilos of happy dust!" As he anticipated, his seemingly flippant remark gets him taken away and searched, just in time to divert attention away from Podkayne's luggage, where he has hidden a package he was paid to smuggle aboard. Podkayne suspects the reason behind her brother's behavior, but cannot prove it. Clark was told it was a present for the captain, but is far too cynical to be taken in. He later carefully opens the package and finds a nuclear bomb, which he, in typical Clark-fashion, disarms and keeps.
Much of the description of the voyage is based on Heinlein's own experiences as a naval officer and world traveler. Clark's ploy is taken from a real-life incident related in Heinlein's Tramp Royale in which his wife answers the same question with "heroin" substituted for the fictitious, but equally illegal happy dust.
Once aboard, they are befriended by "Girdie", a capable and experienced woman left impoverished by her late husband. Much to Podkayne's surprise, the normally very self-centered Clark contracts a severe case of puppy love.
The liner makes a stop at Venus, which is depicted as a latter-day Las Vegas gone ultra-capitalistic. The planet is controlled by a single corporation; the dream of most of the frantically enterprising residents is to earn enough to buy a single share in it, which guarantees lifelong financial security. Just about anything goes, as long as one can pay for it. The penalty for murder is a fine paid to the corporation for the victim's estimated value plus his projected future earnings. On a less serious level, Heinlein anticipated, by over forty years, television (in the book, holographic) ads in taxicabs (now being implemented in New York City). On Venus, the only way to evade the intrusive sights and sounds is to bribe the driver to turn it down.
The Fries are given VIP treatment by the Venus Corporation and Podkayne is escorted by Dexter Cunha, the Chairman's dashing son. She begins to realize that Tom is much more than just her pinochle-playing uncle. When Clark vanishes and even the corporation is unable to find him, Tom reveals that he is on a secret diplomatic mission. Podkayne makes an ill-judged attempt to rescue Clark by herself and falls into the kidnappers' clutches as well--only to find her uncle caught too. The captors' scheme is simple--they will use the children to blackmail the uncle into doing their bidding.
Clark quickly realizes that once Uncle Tom is released, no matter what happens, their kidnappers will have little reason to keep him and his sister alive. Wily genius that he is, he is prepared, however, and engineers an escape. Heinlein's original ending did not please his publisher, who demanded and got a rewrite, over Heinlein's bitter objections.
The story ends with a hint of hope for Clark, as he admits his responsibility for what happened to Podkayne--that he "fubbed it, mighty dry"--then shows some human feeling by regretting his inability to cry and describes his plan to raise the fairy himself--a plan which includes a lot of selfless devotion, because it wakes often at night and needs to be held.
Heinlein's publisher, however, asked him to change the ending, which he did, against his will; his letters indicate he was unhappy with the request. In the revised version, Podkayne is injured by the bomb, but not fatally. Uncle Tom, in a phone conversation with Podkayne's father, blames the parents — and especially the mother — for neglecting the upbringing of the children. Uncle Tom feels that Clark is dangerous and maladjusted, and attributes this to the mother's failure to raise him better.
Clark is still the narrator, and, again, he regrets that Podkayne was hurt and plans to take care of the fairy because Podkayne will want to see it when she is better.
The 1995 Baen edition includes both endings (they differ only on the last page, and Jim Baen, owner of Baen Books, gives his own, third, edited postlude to the story), as well as a collection of readers' essays giving their opinions about which ending is better.
Most of these readers favored the sad ending, partly because they felt Heinlein should have been free to create his own story, and partly because they believed that the changed ending turned a tragedy into a mere adventure, and not a very well constructed one at that.
To many readers, Podkayne's death is one of the more moving passages Heinlein ever wrote. They felt that Heinlein was pointing out how the innocent and pure of heart so often pay for the sins of others, and was trying, through Uncle Tom's narrative, to make a point about the upbringing of children: who takes the place of a working mother? The changed ending also removed the depiction of the powerful sense of loss when the innocent die through no fault of their own.
The opposing view, in favor of the happy ending, may be preferred by many simply because they have grown to love Podkayne's sweet personality, or because the tragedy may lack logic: Podkayne does not seem to view her mother as neglectful, and in any case there is no dramatic reason to punish Podkayne for her mother's supposed sins.
Heinlein wrote in a letter to his literary agent that revising the story would be like "revising Romeo and Juliet to let the young lovers live happily ever after." He also declared that changing the end "isn't real life, because in real life, not everything ends happily."
Interestingly, Poddy attends the party which concludes The Number of the Beast, along with many other of Heinlein's characters.