Olive Penderghast, a 17-year-old girl living in Ojai, California lies to her best friend Rhiannon Abernathy about going on a date in order to get out of camping with Rhiannon's hippie parents. Instead, she hangs around the house all weekend listening to Natasha Bedingfield's "Pocketful of Sunshine", which is played by a greeting card she was sent. The following Monday, pressed by Rhiannon, Olive lies about losing her virginity to a college guy. Marianne Bryant, a prissy and strictly religious Christian at their school, overhears her telling the lie and soon it spreads like wildfire. The school's conservative church group run by Marianne decides Olive will be their next project. Olive confides the truth to her friend Brandon, and he explains how others bully him because of his homosexuality. He later asks Olive to pretend to sleep with him so that he will be accepted by everyone as a 'straight stud'.