On the soon-to-be demolished stage of the Weismann Theatre, a reunion is being held to honor Weismann's "Follies" shows past, and the beautiful chorus girls who once performed there. The once resplendent theatre is now little but planks and scaffolding (Prologue/Overture). As the ghosts of the young showgirls slowly drift through the theatre, a majordomo enters with his entourage of waiters and waitresses. They pass through the spectral showgirls without seeing them.
Sally Durant Plummer, "blond, petite, sweet-faced" and at 49 "still remarkably like the girl she was thirty years ago", a former Weismann girl is the first guest to arrive; her ghostly youthful counterpart moves towards her. Phyllis Rogers Stone, a stylish and elegant woman, even more attractive now, also arrives with her handsome and successful husband, Ben. As their younger counterparts approach them, Phyllis comments to Ben about their past. He feigns disinterest; there is an underlying tension in their relationship. As more guests arrive, Sally’s husband, Buddy, enters. He is a salesman, in his early 50s, appealing and lively, whose smiles cover inner disappointment.
Finally Mr. Weismann enters to greet his guests. Roscoe, the old master of ceremonies, introduces the former showgirls ("Beautiful Girls"). Former Weismann performers at the reunion include Max and Stella Deems, who lost their radio jobs and became store owners in Miami; Solange La Fitte, a coquette, who is still vibrant three decades later; Hattie Walker, who has outlived five younger husbands; Vincent and Vanessa, former dancers who now own an Arthur Murray franchise; Heidi Schiller, for whom Franz Lehár once wrote a waltz (or was it Oscar Straus? Facts never interest her; what matters is the song!); and Carlotta Campion, a film star who has embraced life and benefited from every experience.
As the guests reminisce, the stories of Ben, Phyllis, Buddy and Sally unfold. Phyllis and Sally were roommates while in the Follies, and Ben and Buddy were best friends at school in New York. When Sally sees Ben, her former lover, she greets him self-consciously ("Don't Look at Me"). Carlotta is tired of listening to everyone's stories and wants someone to listen to her. Meanwhile, Buddy and Phyllis join their spouses and the foursome reminisces about the old days of their courtship and the theatre, their memories vividly coming to life in the apparitions of their young counterparts ("Waiting For The Girls Upstairs"). Each of the four is shaken at the realization of how life has changed them. Elsewhere, Willy Wheeler (portly, in his sixties) cartwheels for a photographer. Emily and Theodore Whitman, ex-vaudevillians in their seventies, perform an old routine ("The Rain on the Roof"). Solange proves she is still fashionable at what she claims is 66 ("Ah, Paris!"), and Hattie Walker performs her old showstopping number ("Broadway Baby").
Sally is awed by Ben’s apparently glamorous life, but Ben wonders if he made the right choices and considers how things might have been ("The Road You Didn't Take"). Sally tells Ben how her days have been spent with Buddy, in a "harrowing account of a lonely, middle-aged suburban woman's self-delusions", trying to convince him (and herself) ("In Buddy’s Eyes"). But it is clear that Sally is still in love with Ben – even though she was terribly hurt when Ben chose to marry Phyllis. Sally felt used for his sexual satisfaction. She shakes loose from the memory and begins to dance with Ben, who is touched by the memory of the Sally he once cast aside.
Phyllis interrupts this tender moment and has a biting encounter with Sally. But this confrontation is interrupted by another performance – this time, the ex-chorines line up to perform an old number ("Who's That Woman?"), with disastrous results, as they are mirrored by their younger selves. Afterward, Phyllis and Ben angrily discuss their lives and relationship, which has become numb and emotionless. Sally is bitter and has never been happy with Buddy, although he has always adored her. Carlotta amuses everyone with a tale of how her dramatic solo was cut from the Follies because the audience found it humorous, but somehow the number works when she sings it today ("I'm Still Here").
Ben confides to Sally that his life is empty. She yearns for him to hold her, but young Sally slips between them and the three move together ("Too Many Mornings"). Ben, caught in the passion of memories, kisses Sally as Buddy enters. Buddy is furious, and Ben, startled by the parallel between present and past, tells Sally it was over long ago. He leaves Sally still dreaming of a marriage that will never happen. Buddy angrily fantasizes about the girl he should have married, who would have loved him and made him feel like "a somebody" ("The Right Girl"). Sally tells him that Ben has asked her to marry him. Buddy tells her she must be either crazy or drunk, but he's already supported Sally through rehab clinics and mental hospitals and cannot take any more. Ben drunkenly propositions Carlotta, with whom he once had a fling, but she has a young lover. Heidi Schiller, joined by her younger counterpart, performs "One More Kiss", her aged voice a stark contrast to the sparkling coloratura of her younger self. Phyllis kisses a waiter but confesses to him that she had always wanted a son. She then tells Ben that she cannot return to their loveless marriage. Ben replies by saying that he wants a divorce, and Phyllis assumes the request is due to his love for Sally. Angry and hurt, Phyllis considers whether to grant his request ("Could I Leave You?").
The two couples and their young counterparts argue furiously about how foolish they were when they were young. Suddenly, at the peak of madness and confusion, the couples are engulfed by their follies, which transform the rundown theatre into a fantastical "Loveland", an extravaganza even more grand and opulent than the gaudiest Weismann confection: "the place where lovers are always young and beautiful, and everyone lives only for love". Sally, Phyllis, Ben and Buddy show their "real and emotional lives" in "a sort of group nervous breakdown.
Young Phyllis and Young Ben have hopes for the future ("You're Gonna Love Tomorrow"), as do Young Buddy and Young Sally ("Love Will See Us Through"). Buddy then appears, dressed in "plaid baggy pants, garish jacket and a shiny derby hat", in a vaudeville routine with an imaginary Sally and his old girlfriend Margie ("The God-Why-Don't-You-Love-Me Blues"). Sally appears next, dressed as a torch singer singing of her passion for Ben from then- and her obsession with him now ("Losing My Mind"). Phyllis reflects on the two sides of her personality, "juicy" Lucy — the young Phyllis, naive but passionate, and "dressy" Jessie — Phyllis's jaded, well-groomed present self ("The Story of Lucy and Jessie"). Ben begins to offer his devil-may-care philosophy ("Live, Laugh, Love"), but stumbles and anxiously calls to the conductor for the lyrics, as he frantically tries to keep going. Ben becomes frenzied, while the dancing ensemble continues as if nothing was wrong. Amidst a deafening discord, Ben screams at all the figures from his past and collapses as he cries out for Phyllis.
"Loveland" has dissolved back into the reality of the crumbling and half-demolished theatre; dawn is approaching. Buddy escorts the "emotionally devastated" Sally, while Phyllis helps Ben regain his dignity before they leave, all with the promise to work things out later. Their ghostly younger selves finally enter the light. The younger Ben and Buddy softly call to their "girls upstairs", and the Follies end.