In the 1846 slum neighborhood of Five Points, Manhattan, two gangs, the Nativist Protestants, led by William "Bill the Butcher" Cutting, and a group of Irish Catholic immigrants, the "Dead Rabbits", led by "Priest" Vallon, engage in a battle to determine which faction will hold sway over the territory. During the brutal confrontation, Bill kills Vallon and declares the Dead Rabbits outlawed. Having witnessed this, Vallon's young son hides the knife that killed his father and is taken to an orphanage on Blackwell's Island.