Adapted from a play by David Belasco, a singing saloon owner discovers the singing man she loves is a notorious bandit.
Orphan Mary Robbins sings at a wagon-train camp and is heard by a boy with Mexican bandits. Padre Sienna (H. B. Warner) encourages the boy to be good. However, years later the bandits are led by Richard Ramerez (Nelson Eddy), who brings gifts to Nina Martinez (Priscilla Lawson). At a mountain cabin shy Alabama (Buddy Ebsen) loves Mary Robbins (Jeanette MacDonald), who sings "Shadows on the Moon." At her saloon Mary objects to sheriff Jack Rance (Walter Pidgeon) shooting a customer but thanks him for the new piano. She sings "Liebestraum." Jack wants to marry her and sends a posse with her to Monterey. On the way Ramerez holds up her coach, and his men and Mosquito (Leo Carrillo) capture the posse. Mary saves gold for the padre's Indians. In church Mary sings "Ave Maria," and the Governor invites her. Ramerez as Lt. Johnson escorts Mary, and Mosquito drives them slowly as Ramerez sings "Señorita." Ramerez kisses Mary, and she drives off alone. At the Governor's fiesta Ramerez sings "Dance with Me" and rides off.
Mosquito says that Ramerez is in love. Mary tells Alabama about her trip. Jack tells Mary that he is going to get Ramerez. Mosquito has Alabama shoe his horse and implies that he is Ramerez, who finds Mary at her saloon. Alabama tells Jack to go after Ramerez. Mary criticizes Ramerez for stealing people's money. He forgoes her gold, goes outside with her, and sings "Who Are We to Say?" Mary invites him to supper, and he arrives in a blizzard. Mary tells him that she wants to marry him. Ramerez hears her song and realizes he saw her as a child. Ramerez hides before Jack comes in. Jack tells Mary that he learned Lt. Johnson is Ramerez from his jealous girl Nina. Alabama covers for Mary and leaves after Jack. Mary is angry at Ramerez. He is wounded and comes back in. Jack looks for Ramerez but takes Mary's word. Jack kisses Mary, but she hates it. Jack arrests Ramerez as he collapses. Mary offers to gamble herself for Ramerez. She wins by cheating but says she will be a good wife to Jack if he lets Ramerez go. Jack agrees, and Mary kisses him.
Mary asks Alabama to pack her wedding gifts. To say good-bye to the men at the saloon she sings "Who Are We to Say?" and cries. Ramerez goes to padre Sienna and reminds him how they met. Mary and Jack arrive to wed. Mary hears Ramerez humming and tells him to go but admits she loves him. Jack hears and leaves. In the final scene on a covered wagon Ramerez and Mary sing "Señorita" and kiss.
In this musical about the California gold-rush era the influence of padre Sienna on Ramerez and Mary and their kind characters seem to conflict with their roles as bandit and saloon owner. From these shady roles they are allowed to emerge thanks to the graceful renunciation of Jack, though what will the future hold for Ramerez with such a large reward for his capture?