Francisquita is in love with student and would-be poet, Fernando. He, however, is infatuated with the fiery actress Aurora la Beltrana, who in turn is the lover of Lorenzo Pérez. When Francisquita tries to flirt with Fernando, he ignores her. His friend Cardona takes him to task and suggests that he would be happier with her than Aurora. Francisquita is then wooed by the Don Mathias, Fernando's father, in the presence of Doña Francisca, Francisquita's mother. At first, Doña Francisca mistakenly believes that she is the object of Don Mathias' affections. Francisquita pretends to accept the elderly man's advances, hoping to make Fernando jealous.

At the urging of Cardona, Fernando also makes advances to Francisquita hoping to make Aurora jealous. Fernando's passion for Francisquita starts to grow. He is horrified that she might marry his father and become Doña Francisquita. He tells Aurora that she no longer has any power over him, which at last piques her interest in him. But it is too late, he is now completely in love with Francisquita. All is resolved after a series of misunderstandings and machinations involving Cardona disguising himself as a woman; Aurora's lover, Lorenzo Perez, challenging Fernando to a duel; and rumours that Fernando plans to marry Francisquita's mother to the subsequent horror of Don Mathias. Don Mathias eventually realizes he is too old for Francisquita and gives his blessing to the young couple. In the finale all celebrate the forthcoming wedding of Francisquita and Fernando by singing "Canción de la Juventud" ("Song of Youth"), a hymn to the youthful spirit of Madrid.