The scene is set in the house of the Eisensteins (who are in nouveau riche with pretensions of upward mobility to the minor nobility, preferably in Vienna). They are bored with small town life and possibly with each other.

Outside the house Rosalinde’s ex-lover Alfred, a would-be great tenor is serenading her. Rosalinde chambermaid Adele, is listening and working out how she can use the Alfred/Rosalinde situation to her own advantage (she has made a virtue of exploiting family secrets).

Adele has received an invitation to a party to be held that very evening, and to be hosted by one Prince Orlofsky. The usual excuse of a sick aunt does not quite work with Rosalinde, who needs support as her husband has to start his five-day jail sentence (for some minor offence, the Austrian equivalent of hitting a meter-maid).

Alfred arrives but is soon shown the door – though with an invitation to return later. Rosalinde begins to see the advantages of Adele being given the evening off. Eisenstein arrives with, and cursing, his lawyer, Blind, who has been incompetent enough to have his jail sentence extended rather than reduced. Blind leaves, and Falke, Eisenstein’s best friend arrives.

Falke has his own agenda; to take revenge on Eisenstein who, having got him drunk, deserted him in the streets, where he was found by the townsfolk the next morning, still in the guise of a bat. Fake has persuaded Prince Orlofsky to give him the oncoming party and has invited three unlikely guests, Adele, Eisenstein and Rosalinde, in order to amuse the worldly-bored Orlofsky whilst his friends will be as humiliated as he once was. Eisenstein takes little persuading to attend the party, planning to arrive at the jail by midnight.

The three members of the household say their regretful farewells, none of them successfully hiding their true feelings. Eisenstein and Adele depart, and Alfred immediately arrives. He makes himself free with Eisenstein’s best wine and puts on his host’s best dressing-gown. He is interrupted by the doorbell (before things have gone quite so far as each party may have liked). Frank, the warden of the jail enters and announces he is collecting Eisenstein early as he has "another appointment" (he is obviously another friend of Falke’s). Alfred, mainly because of the toxic wine but, we hope, partly to save Rosalinde’s honour, agrees to be Eisenstein and he is led off by Frank.

Act Two

As guests arrive at the party Falke is amusing Orlofsky with the details of his plot and pointedly identifying the participants. Adele and Eisenstein arrive separately but he quickly identifies Adele as his wife’s maid. Adele swiftly responds with a catalogue of all her personal attributes, none of which one would hope to find duplicated in any mere chambermaid. Eisenstein is confounded and Orlofsky is delighted, more so when Frank and Eisenstein, both sporting French disguise, strike up a friendship.

Rosalinde arrives disguised as a Hungarian princess – and masked, Eisenstein does not recognise her. His attempt at seduction is by his usual well-tried method, tempting the temptress with his chiming watch. Rosalinde plays along – but only until she can ‘pocket’ the watch. Rosalinde, the masked star of the party, proves her credentials by launching into a Magyar song.

Orlofsky, in the meantime, is regaling new acquaintances with his story of Falke’s humiliation; that the tables are currently being turned does not cross his mind.

The party goes on until the morning. Frank and Eisenstein go their supposedly separate ways, as do most of the other guests.

Within the jail Frank is regretting the previous night’s intake, and his pounding brain is not helped by the noise of a rousing tenor voice, reverberating through the building and obviously coming from the cells. He has two visitors, Adele and her sister Ida. Adele has spotted this ‘cultured Frenchman’ as a likely influence to help her take her destined place amongst the great artists of the stage. She immediately auditions for him.

Eisenstein comes in, and the truth of their identities comes out. Frank is appalled, as he knows that he already has ‘Eisenstein’ in custody. On hearing Frank’s story, Eisenstein explodes in anger. A masked lady and Blind, the lawyer, enter. She evades meeting Eisenstein. Blind has been called to act as Alfred’s advocate. Eisenstein persuades (bribes the venal) Blind to exchange clothes, and rushes off to Alfred’s cell – to find his wife in situ.

This situation only resolves itself when Falke, Orlofsky and all other party guests arrive. Falke explains the successful plot and Orlofsky provides even more champagne to revive everyone’s party spirit.