11-year-old Davey, whose mother is dead and whose father is preoccupied with his own problems, has retreated into a world of video games and an imaginary hero-pal, the swashbuckling superspy Jack Flack. When an FBI agent about to be murdered slips him a video cartridge containing top-secret data, Davey is suddenly plunged into the intrigue and danger of real-life espionage. No adult believes his story, so he must run a gauntlet of violence and villainy aided only by a younger girl and the encouragement of "Jack Flack" at his side. How long can a comic-book role model guide him through this encounter with reality?

The video game which is central to the movie had already been in development as production of the film began (the game then named "Agent X"); when Atari was consulted to provide a game as an element of the movie, they tweaked "Agent X" and renamed it Cloak & Dagger. Dabney Coleman's character was then named "Agent X" in the movie. The game saw limited arcade release.

Davey Osborne:
Jack Flack always escapes.

Factual errors: The secret plans shown on the cartridge are at a very high resolution and include many "camera movements" such as zooms, pull-outs and pans. All of these were impossible to do on an Atari 5200.