Yonkers store-owner Horace Vandergelder refuses to allow his niece, Ermengarde, to marry Ambrose Kemper. He informs Ambrose that he is sending his niece away to stay with a friend, but Ambrose easily learns that she will be in New York City and plans to follow her there. Meanwhile, Horace has arranged for a matchmaker to find a wife for himself.
Dolly Levi, the matchmaker, has arranged for Horace to meet Mrs. Irene Molloy, a New York City milliner, even though she secretly intends to marry him herself. However, Horace surprises her when he announces he is leaving today for New York City in order to propose marriage to Mrs. Molloy. Dolly hastily invents another woman and convinces Horace to not propose to Mrs. Molloy yet, but to meet this new woman at a New York restaurant that evening.
Cornelius Hackl and Barnaby Tucker, two of Horace’s clerks, decide they deserve some adventure of their own, in spite of the fact that Horace has left them in charge of the store. They decide to take the train to New York City that afternoon, resolving not to come back to Yonkers until they have had an adventure and kissed a girl.
In her New York City hat shop, Mrs. Molloy and Minnie Fay, her assistant, discuss the possibility of Horace proposing marriage to her. Cornelius and Barnaby happen by, and, seeing Horace and Dolly approaching, duck into the shop where they convince Mrs. Molloy to hide them. Horace, however, learning that Mrs. Molloy is hiding two strange men, tells her he does not wish to see her again, so Dolly leads him away to the meeting with the non-existent “other woman.”
Meanwhile, Cornelius has become smitten with Mrs. Molloy who thinks he is a wealthy man-about-town and insists that Cornelius and Barnaby take her and Minnie to a nice dinner, at the same restaurant Dolly and Horace are headed for.
Horace is the first to arrive at the Harmonia Garden Restaurant. Dolly enters next, escorting Ambrose and Ermengarde, whom she is trying to help. Horace quickly hides, then, realizing Ambrose and Ermengarde are planning to wed, he arranges for a cab driver to intercept them when they come out of the restaurant and take them to a friend’s home. The young couple goes to another room to dine, and Dolly goes in to meet with Horace and the “other woman.”
Mrs. Molloy, Minnie, Barnaby and Cornelius enter next. They are seated at a table right next to Horace and Dolly, with only a screen between them. Dolly informs a very upset Horace that the “other woman” has eloped with another man. By cleverly suggesting that she herself would never marry Horace, she begins to pique his interest.
Meanwhile, Cornelius and Barnaby have discovered that their employer is on the other side of the screen and are in a panic. Mrs. Molloy suggests they disguise themselves with the women’s coats and veils, but Horace discovers his clerks and angrily fires them. The two men leave the restaurant, with Barnaby still dressed as a woman. Ambrose and Ermengarde enter, Horace becomes angrier still, and the entire scene is chaos!
The action now shifts to the home of Flora van Huysen. A cab arrives with Cornelius and Barnaby (still dressed as a woman), and the driver forces them into the house, thinking they are the couple Horace paid him to detain. Flora also mistakes them for Ambrose and Ermengarde and tries to make them feel at home. Next to arrive are the real Ambrose and Ermengarde (whom Flora insists cannot be who they say they are), followed quickly by Dolly (still scheming to bring all the couples to a happy conclusion), Mrs. Molloy and Minnie (who have been caught up in everyone else’s “adventure”), and Horace (who is still angry and becoming more and more perplexed).
The scene turns to utter pandemonium as everyone tries to sort out identities and relationships. Yet, somehow Dolly maneuvers through it all, bringing everything to a happy, albeit hysterical, end.