Near the beginning of the story, Pentangeli approaches Michael to ask for his help in eliminating the Rosato brothers, rivals in New York, who claimed to have been promised territories by Peter Clemenza prior to his death, but Michael refuses. He orders Pentangeli to do nothing, as he does not want a war to interfere with an upcoming deal with Hyman Roth, who supports the Rosatos. Pentangeli takes this as an insult and leaves in anger. Later that night, Michael narrowly escapes an assassination attempt at his home.
Suspecting that Hyman Roth was behind the assassination attempt, Michael meets with Pentangeli and asks him to help take his revenge. Pentangeli agrees, promising to end his feud with the Rosato brothers and giving the impression that Michael supported their claim, so as to give Roth the impression that Michael did not know he was conspiring against him.
Back in New York, Pentangeli arranges a meeting with the Rosato brothers. At the meeting, Tony Rosato (played by Danny Aiello) ambushes Pentangeli with a garotte, telling him, "Michael Corleone says hello." A policeman passes by and the murder attempt devolves into a shootout in the street. Pentangeli disappears and is believed to be dead.
Although Rosato invokes Michael's name in the attempted hit on Pentangeli it is clear from dialogue between Michael and Fredo that Pentangeli's fate after the shootout was a mystery to Michael. This discussion happens in the brothers' first meeting following Michael's confrontation with Fredo in Havana.
Later, at a Congressional hearing, Pentangeli is presented as a surprise witness by the committee. He has been in the custody of the FBI since the murder attempt, believing that Michael ordered him killed. He is prepared to testify that Michael is the head of the most powerful Mafia family in the nation and has ordered countless murders. He is considered very credible, since as a capo there is no insulation between him and Michael. Pentangeli also intends to testify that Michael personally murdered Captain McCluskey and Virgil Sollozzo (in The Godfather). Because Pentangeli's protective custody is so secure, Michael knows he will be unable to have him killed before the trial. Instead, he flies Pentangeli's brother, Vincenzo, in from Sicily, who appears in the hearing room. Upon seeing his brother, Pentangeli then recants his earlier statements, and now claims that the Corleone family is innocent of any wrongdoing, thereby derailing the government's case.
After the hearing, Tom Hagen visits Pentangeli. Pentangeli discusses how tough his brother is, much tougher than himself, says Frankie. Hagen tells Frankie that he did the right thing by recanting, and that if he accepts responsibility for turning on the Corleone family, Frankie's own family will always be taken care of and remain unharmed. He thanks Hagen, returns to his room, and slits his wrists in the bathtub.
The finished film leaves unclear exactly what about his brother's presence caused Frankie to change his story. An early version of the script, however, details that Frankie's brother is himself a hardened Mafia chieftain in Sicily. Shocked that Frankie is about to betray the Corleones, his brother appears to remind Frankie that he must not break the Mafia's code of silence, Omertà . His brother's mere presence and icy stare directed at Frankie serve as a threat that if Frankie follows through with his planned testimony, retribution will be taken against his former mistress and their child, who are living in Sicily under his brother's guardianship.