Kala Bazar (meaning "black market") essentially dealt with black marketing of movie tickets, which Dev Anand does in the film. The story follows the template of a protagonist who takes the wrong path to make money and then realizes his mistake, for which he has to pay back.

Raghuvir (Dev Anand) is a poor bus conductor who is fired from the job after getting into an argument with a passenger. With an ailing mother (Leela Chitnis) and two younger siblings to take care of, Raghu doesn't know how to provide for his family. When he passes by a cinema hall and sees Kalu (Rashid Khan) selling movie tickets, he gets an idea. Seeing that as a good source of quick money, he too decides to black market movie tickets. But for that, he needs capital to start with. So he robs Advocate Desai (Chetan Anand) of Rs 5000 and soon sets his own network of black marketers outside all prominent cinema-halls of Bombay.

First, he works with Kalu, and at the premiere of Mother India, their tickets sell faster and faster as more film stars arrive - they include Dilip Kumar, Geeta Dutt, Guru Dutt, Kishore Kumar, Raaj Kumar, Rajendra Kumar, Lata Mangeshkar, Sohrab Modi, Mohammed Rafi, Nargis, Nadira and Nimmi. Finally, he sells his last ticket for 100 rupees when one ticket cost only 2 rupees. Elated with his newfound business, Raghu and Kalu go from strength to strength, recruiting many poor and homeless thieves. When Ganesh (Madan Puri) dares to challenge him, Raghu beats him up. The next day, Ganesh agrees to work for Raghu. Now a wealthy man, Raghu buys a new, spacious flat for his family on Marine Drive. Things change when a group of students buy movie tickets from him. Alka (Waheeda Rehman) finds out that her friends bought them in black, and tears the tickets as she hates black marketing. This has a great impact on Raghu and he gets attracted towards Alka, who is standing nearby and watching. She was in love with her boyfriend, Nandkumar Chattopadhyay (Vijay Anand) who promises her not to do it again. Smitten with Alka, Raghu starts to follow her. So, when Nand gets a scholarship and travels overseas, Alka's parents decide to take her to Ooty to take her mind off Nand. Raghu sees this as a perfect opportunity and gets on the same cabin as her family and attempts to woo Alka on their trip to Ooty, but in vain. He sings "Apni To Har Aah Ek Toofan Hai", trying to flirt with Alka, while the song itself was veiled as a prayer. He also helps to cure Alka's father's back pain with a massage, and soon, he becomes friends with the family. Though he is unable to win Alka, his feelings towards her makes him a changed man and he gives up the path of black marketing.

All that taken care of, he sets out to romance Alka, but she resists and turns away his love when she lies that she is engaged to Nand. Heartbroken, Raghu returns to Bombay to continue his business, but his love for Alka has changed him. When he left Alka in Ooty, he promised that he would never do anything bad. Raghu tries to convince his partners to stop black marketing and get an honest job, but they all eventually go back to their bad deeds. Raghu continues to try and earn an honest living, and to his surprise, he meets Alka one day in Bombay. Alka, meanwhile, also falls for Raghu, but hesitates to tell him. Finally, she writes a letter to Nand, telling him to forget her, because she loves Raghu. The latter is delighted, and Alka tells him to come in the evening to talk to her parents. However, everything goes awry when she learns that Nand has returned. When Nand comes to her house, the two of them argue, but finally both concede that their "love" was just childishness. Now free to profess her love for Raghu, Alka goes to his house, only to learn that he has been arrested for black marketing. The movie takes a turn and the court case is with Advocate Desai (Chetan Anand). The court room drama is really engaging as it shows how the black marketers changed the kala bazaar to Safed Bazar and all the people working for Raghubir (Dev Anand) give their opinion which is his positive side. The movie ends with the classic timeless track "Rimjhim Ke Tarane Leke Aayi Barsaat" with Dev Anand and Waheeda Rehman walking in the rain under a single umbrella.

Kala Bazar was Vijay Anand's second directorial venture after the success of his debut venture Nau Do Gyarah. His writing was multi-layered, where he enmeshed a charming love story inside the central plot of going the wrong (illegal) way in life. There were some very unconvincing conflicts like how the 8th pass Raghuvir showed a sudden keen interest towards gaining knowledge because of Alka. Coincidentally, he also accidentally stumbles upon a BA scholar (Krishan Dhawan) who takes his tuitions. But the pacing was very fast and kept the viewer engaged.

Like in Nau Do Gyarah, where he stationed a major portion of the film in the hill station of Mahabaleshwar, here, Vijay Anand explores the beauty of the South Indian hill station Ooty. Dev Anand kept strolling through the gardens of Ooty in the song "Khoya Khoya Chand" in his trademark swaying motion where he kept swinging his arms all through. It might appear rather funny today, but back then it was Dev Anand's patented dancing style which he continued for years to come. The scene immediately after the song was considerably bold by the 60s standards, where Waheeda Rehman removes her sari to use it as a cord to pull Dev Anand up, when he slips down from the cliff.

The love story in the film was refreshingly restrained and despite a love triangle, Vijay Anand never loaded the proceedings with melodrama. The screenplay never makes a huge hue and cry of the scene when Waheeda Rehman rejects Dev Anand, and yet remains his friend or subsequently when she gets back to Dev Anand and disowns Vijay Anand. The director had a very matured and progressive outlook towards relationships.

The film also deals with its title conflict of black marketing very smartly. Dev Anand's repentance for his misdeeds and the way he convinces his gang to give up the wrong path is very interestingly portrayed. The courtroom drama in the climax (where Chetan Anand fights for Dev Anand) is thoughtfully conceptualized and very well-worded with a balanced and impartial point of view. It neither glorifies or glamourizes Raghuvir's black-marketing nor does it ignores his remorse.

Through black marketing outside cinema-halls of Mumbai, the film captures the glory of good old movie theatres of the city, some of which (like Liberty and Metro) exist even today. Vijay Anand also very intelligently incorporated the real-life premiere footage of the film Mother India in the initial reels of Kala Bazar, thereby adding immense (cameo) star value to the film, showing the likes of Dilip Kumar, Nargis, Guru Dutt, Rajendra Kumar, Sohrab Modi, Kishore Kumar, Mohammad Rafi, Lata Mangeshkar and many more names. Years later, Manmohan Desai and Farah Khan replicated the same formula in their films Naseeb (1981) and Om Shanti Om (2007) respectively and to good effect.

Like any Navketan production, even this film was blessed with melodious tunes by S. D. Burman. The soundtrack had everything from love songs to a bhajan to a Helen cabaret number. "Khoya Khoya Chand" and "Rimjhim Ke Tarane Leke Aayi Barsaat" are timeless tunes. The picturization of the song "Teri Dhoom Har Kahi" starring Dev Anand and his sidekick Rashid Khan was borrowed by Rakesh Roshan in a similar theme song "Yeh Paisa Bolta Hain", starring Kader Khan and his sidekick Johnny Lever in his 1989 film by the same title, Kala Bazar.

Dev Anand was charming as always and gave a splendid performance in a character that had an interesting grasp. Waheeda Rehman looked beautiful and was natural as ever in her performance. Vijay Anand and Chetan Anand were good in their special appearances. Nanda played a supporting part as Dev Anand's sister and was decent.

• Dev Anand as Raghuvir
• Waheeda Rehman as Alka
• Vijay Anand as Nandkumar Chattopadhyay
• Chetan Anand as Advocate Desai
• Nanda as Sapna
• Rashid Khan as Kalu
• Madan Puri as Ganesh
• Leela Chitnis as Raghuvir's mother
• Helen as Dancer/Singer
• Mumtaz Begum as Mrs. M.L. Sinha
• Sushil Kumar as Raghuvir's Brother

The film has a scene in which several stars make guest appearances while appearing for the premiere of the movie Mother India. They include Dilip Kumar, Geeta Dutt, Guru Dutt, Kishore Kumar, Raaj Kumar, Rajendra Kumar, Lata Mangeshkar, Sohrab Modi, Mohammed Rafi, Nargis, Nadira and Nimmi. Others seen include, Kumkum, Mukri, Yakub, Naseem Banu and Kumari Naaz.

All lyrics written by Shailendra; all music composed by S. D. Burman.