It's Cheltenham racecourse, about an hour before the first race on the opening day of the Paddy Power Gold Cup meeting in November. The sky is grey and the temperature's falling, but that hasn't deterred the crowds flocking through the gates.

Down in the betting ring, the bookies' pitches - the time-honoured mixture of boards, bags and boxes that make up their joints - are being assembled. Bombastic men such as Barry Dennis, conspicuously leaving the preparations to his minions, fling louder enquiries back and forth. Gregory and John Hughes are there; Andy Smith and John Christie are there; Mickey 'The Asparagus Kid' Fletcher, face like a 'Wanted' poster, scowls from the sidelines.

But one man, 62-year-old Scotsman Freddie Williams, one of the most important actors in the drama, hasn't yet arrived. Relatively diminutive in stature he may be, but he is without doubt the biggest boards bookmaker at Prestbury Park.

Freddie, like a boxer delaying his entrance, is still sitting comfortably in his Jaguar several hundred yards away in the members' car park. His attractive, dark-haired daughter Julie and other members of his on-course team are already in place on the pitch. The softly spoken boss confers with them by phone, also taking calls from other on- and off-course associates as he monitors the early activity and estimates the plays the day may bring.

At the Cheltenham Festival in March 1999, the Scotsman laid JP McManus, the Sundance Kid of racing legend, a colossal £100,000 each way at 7/1 on his own horse Shannon Gale in the Pertempts Hurdle Final. This wasn't some colourless transaction on a computer screen or in a remote corner of cyberspace. This was hand-to-hand combat in the heat and gun-smoke of the Festival. Shannon Gale, trained by the wily Christy Roche, finished fourth and JP collected £175,000 from the each-way part of his wager; if the gamble had won, Freddie Williams would have been on the wrong end of a payout approaching £900,000.

What makes his story so interesting isn't just his wholehearted embrace of traditional bookmaking and disdain for the cautious, corporate approach of the big betting-shop chains. There's also a recognition that this is a man who didn't start out with too many natural advantages and who has earned the right to be a player on the greatest racing stage of them all.

Freddie was born in 1942 in Cunnock, a small coal-mining town in East Ayrshire. His father was a miner, like his father before him.

Freddie, like the rest of his male relations and contemporaries, would have gone down the pit himself had he not failed the medical. 'I was only 15 at the time,' he recalls, 'so instead I became a mining engineer. A few years later, I went to work for a soft drink company called Currys in Auchinleck, another little mining town nearby. Everyone I knew liked a bet in those days, and the backbone of gambling in the mining communities was pitch and toss. It seemed as if every village had its own pitch-and-toss school, and you'd see men there from dawn to dusk.'

Even then, horse racing, especially jump racing, was exerting a far greater allure. 'One of my all-time favourite horses was Pas Seul and I remember backing him in the Gold Cup the year before he won. It was 1959. I was earning about a pound a week at the time and I kept my money in a tin box. There were illegal betting offices all around Ayrshire and I put everything I could on Pas Seul. He came to the last full of running but then he fell.' Williams laughs ruefully at the memory. 'Kerstin stayed on to win the race. Pas Seul made no mistake the next year, though.'

Scots and wry
Freddie's love of a punt was shared by his workmates at Currys, all of whom studied the racing form each day. They also combined in a workforce buy-out of the business and the subsequent return enabled Freddie to branch out. He bought his first bookmaking pitch at Ayr in 1974, followed by one in Hamilton and one in Musselburgh. He would go on to own seven betting offices, now cut back to three. After Currys was bought out again in 1991, Freddie, now a millionaire, started his own bottled-water business called Caledonian Clear.

Some of Williams' southern-based competitors like to insinuate that it must be very nice 'playing at bookmaking' when you've got another source of income in the background. However, the inference that Freddie's racing job is some sort of amateurish sideline is one he hotly denies.

'Bookmaking is my livelihood and my passion in life, although there are weeks, let alone months, when you think you should be doing something different,' he stresses.

The enthusiasm and nerve Freddie brings to his job is something the Southerners didn't witness for themselves until the massively overdue reforms that allowed racecourse pitches to be bought and sold at public auction in the late 1990s. The antiquated system of Dead Man's Shoes, whereby the bookmaking pitches were restricted to successive generations of the same family, was a sort of Masonic protection racket that shut out new money and new faces from the ring.

'I first put my name down for Cheltenham in 1976,' remembers Freddie. 'It was almost impossible to get a pitch there in those days. 22 years later, I think I was still only 45th on the list. At that rate, I'd have been about 150 years-old before I got in.'

All heart
The bookie chuckles at the absurdity of it all, but the changes to the system very nearly came too late for him. 'I had a triple-heart-bypass operation in 1998, four weeks before the first pitches were put up for sale,' he explains. 'I was actually up and running again very quickly. Shortly after that, I came down and bid £90,000 for the number-two Tattersalls pitch at Cheltenham.'

The Scotsman was at Cheltenham bright and early on 1 January 1999 and then again in March. McManus and his fellow Long Riders quickly sought him out. As well as opposing Shannon Gale, the bookmaker also took on Nick Dundee, the Irish banker of the week, in the Sun Alliance Chase. The young novice ran in the colours of McManus' close friends John and Sue Magnier and was trained by Eddie O'Grady, who thought seriously about going for the Gold Cup instead. But Freddie didn't fancy Nick Dundee.

'I was going 11/8,' he says. 'One fellow came up and wanted £80,000 on, and I laid it to him, but I didn't take down the price afterwards. He looked at me for a moment and looked around at his friends, and then asked for the bet again. So I laid him another £110,000 to £80,000, but I still didn't take down the price.'

It was a close-run thing, and then fate intervened on the bookmaker's behalf. Nick Dundee's legs gave way on landing over the third last fence and in Freddie's words 'all you could hear were the groans of 65,000 Irishmen.' Plus, presumably, the sound of one Scottish heart beating faster.

Freddie wasn't so lucky at Newbury in March 2003, though, when JP McManus had a winning bet of £200,000 at 5/2 on a horse of Jonjo O'Neill's called An Muine Muice. Then there was the opening day of the 2002 Festival when the McManus-owned Like A Butterfly, the subject of a £100,000 bet at 15/8, won the Supreme Novices Hurdle by a rapidly diminishing neck.

Yet the relationship between bookie and punter seems to be characterised by a striking degree of mutual respect. 'We're friends,' says Williams, without a trace of insincerity. 'John was in business as a bookmaker for 15 years. He had a good bet on Dawn Run when she won the Gold Cup in 1986 and that helped him to change his life. However, he told me that if she'd lost, he'd have been skint the following week.'

That's entertainment

Freddie admits: 'Festival trading is totally draining, which is why I stay in a nice, quiet hotel. When you get back, all you want to do is eat and sleep. I'm afraid I'm well behind in the entertainment stakes.' There was plenty of entertainment on 12 November last year, though: The Rising Moon, running in the McManus colours, was the medium of a £100,000 plunge at 3/1 in the Grade Two novices hurdle. It came in fourth. Half an hour later, JP's Spot Thedifference won the Sporting Index cross-country chase. Someone stuck on £28,000 at 7/1 for a payout of nearly two hundred grand.

Spot Thedifference will be back for the new cross-country Festival race on 15 March. JP will be there, as will Freddie Williams. It just wouldn't be Cheltenham without him.