A Texan-accented narrator introduces the viewers to the shadowy Denton TV executive Farley Flavors (Cliff De Young), who has lived his life "fast" but still feels incomplete without a certain woman... who belongs to someone else. As Flavors watches from his office, his television studio... which now encompasses the entire town of Denton... is steadily filled with the former residents of Denton, who gleefully assume their new roles as studio audience members of a 24-hour live reality television broadcast ('Overture'). The sole holdout in the celebration is the neurotic Brad Majors (also Cliff De Young in a dual role), who despite the insistence of his wife, Janet (Jessica Harper), that things will be OK, is ambivalent about the town's transformation. Once the audience is seated, they are greeted by a welcoming committee led by local reporter and documentary filmmaker Neely Pritt (Betsy Brantley), who inform the audience... and viewers on television... of Denton's supposed virtues ('Denton, U.S.A.').Brad and Janet are chosen as contestants on "Marriage Maze," a supposed game show whose only purpose seems to be committing people to "Dentonvale", Denton's resident hospital and insane asylum which also serves as the reality TV hospital series of the same name. Janet is given the opportunity to have Brad committed by the show's host, a supposedly blind and flaky Austrian named Bert Schnick (Barry Humphries), who promises her that the experience will improve their marriage. Janet and Brad lament the state of their relationship, with Janet ultimately deciding to have Brad sent to Dentonvale ('Bitchin' in the Kitchen').Upon arriving at Dentonvale, Brad and Janet are greeted by the eccentric staff whom include Nurse Ansalong (Nell Campbell), her boyfriend and fellow orderly 'Rest Home' Ricky (Rik Mayall), and Dentonvale's supervisors, the apparently incestuous siblings Dr. Cosmo and Nation McKinley (Richard O'Brien and Patricia Quinn). Despite Brad's objections, Cosmo has him drugged, bound, gagged, and placed in a padded cell known as the "Terminal Ward." Before Janet can sign the papers permitting the McKinleys to treat Brad, Nurse Ansalong tells her to wait a day, to give her time to make up her mind.Meanwhile, Janet's parents, Emily and Harry Weiss (Darlene Johnson and Manning Redwood), are brought onto "Marriage Maze" and promised a prize if they offer a psychological assessment of Brad. Deciding that he is regressing into childhood, the Weisses are awarded a vacation home on another of DTV's reality TV programs called "Happy Homes". Janet goes to meet them there and laments Brad's lack of assertiveness, wishing he could see that she still loves him instead of giving into the doldrums of marriage ('In My Own Way'). Mr. Weiss chastises Janet for marrying Brad, an orphan whose parents died in a car crash, rather than other boys from more stable home backgrounds. Janet tells her father that the boy he'd wanted her to marry turned out to be gay, prompting Mr. Weiss to proclaim the virtues of traditional American masculinity ('Thank God I'm a Man').In Dentonvale, the McKinleys are informed by Bert that financing for their show has been taken over by Farley Flavors' own personal company, a fast food enterprise, named "Five Flavors", which Farley hopes to use to finance a pop psychology movement, using a new TV reality/talk show program titled "Faith Factory" as the platform and the McKinleys as his mouthpieces. The reluctant McKinleys are quickly taken in by a persuasive videotaped pitch, and on Farley's orders, they recruit Janet to be the face of Farley's "Take Away Psychology," as he believes she is the perfect example of the girl next door ('Farley's Song'). Janet moves into Dentonvale with the McKinleys and Bert Schnick, with the promise that her new life as an exciting model will make her desirable to Brad again ('Lullaby').Meanwhile, Judge Wright (Charles Gray) and Betty Hapschatt (Ruby Wax), two DTV presenters from the news show "Denton Dossier" whom are sympathetic to Brad, look into the histories of Farley and the McKinleys, suspecting that there is a sinister motive behind "Faith Factory." However, their investigation is hampered when they are informed that they are being replaced as anchorpeople of "Denton Dossier" by Betty's ex-husband Ralph (Jeremy Newson) whom is currently dating the hot blond reporter Macy Struthers (Wendy Raebeck) whom gets promoted to be the new co-anchor.The next day, after Nation catches a fully-sighted Bert Schnick spying on Janet in the shower, Cosmo strokes Janet's ego and designs a sexy new outfit for her, transforming her into "Miss Mental Health" ('Little Black Dress'). DTV manufactures Janet into an overnight sensation, and the newfound fame immediately goes to Janet's head, causing her to forget about repairing her marriage with Brad as she makes her debut by singing her song to the studio audience of her new fame. ('Me of Me').Janet, her parents, and Bert Schnick go to visit Brad at Dentonvale, where the Weisses question whether the McKinleys can really help him. The Dentonvale Staff assure everyone of their competency, "curing" Bert's blindness to demonstrate their abilities ('Shock Treatment'). Janet and her parents are completely taken in, but Janet's ego becomes difficult for the McKinley's to control. To keep Janet manageable, they drug her in her dressing room, resulting in a surreal dream sequence in which she patrols Denton looking for sex while Brad begs her for love from his asylum cell ('Looking for Trade').As the premier of the new psychology reality TV show "Faith Factory" nears, Bert, the Dentonvale Staff, and the Weisses prepare for their new TV roles by dressing up in white doctor and nurse uniforms in the wardrobe room as they sing about their new images ('Look What I Did To My Id').Meanwhile, Betty hacks into DTV's computer system and learns that the McKinleys are in fact character actors and that "Dentonvale" isn't a real hospital."Faith Factory" goes on the air, opening with a live musical performance by Janet's groupies, a punk band called Oscar Drill and the Bits ('Breaking Out'). Using the performance as a cover, Judge Wright and Betty dress up as doctors and break Brad out of Dentonvale, telling him that they've learned Farley is his biological twin brother, who was split from him during the adoption process and grew up poor. Now the wealthy and powerful Farley wants to destroy Brad's life out of jealousy and is planning to seduce Janet on national TV as the last part of his plan.Brad, Judge Wright, and Betty break through the wall of the "Faith Factory" set, and Brad finally confronts Farley face-to-face about his plan ('Duel Duet'). Farley demands Brad be remanded to the hospital, but Janet, finally snapped out of her ego-trip, informs him that she never signed the consent forms. Angrily, Farley has Brad, Janet, Wright, and Betty arrested, and hastily names DTV host Macy Struthers as the new "Miss Mental Health." His psychology program ready to go, Farley invites the studio audience to join him in Dentonvale, to which they readily agree... they are all summarily handed stripped straight jackets, which they happily don and file out of the studio.Betty uses a hairpin to pick the lock on hers, Brad, Janet and the Judge's holding cell, and the shunned and defeated foursome resolves to leave Denton behind, but with their hopes and ideals intact despite the loss of everything ('Anyhow Anyhow'). With the help of Oscar Drill and the Bits, they hotwire a car that was meant to be a prize on "Faith Factory" and they all drive away off the deserted soundstage, out of the studio and the town itself, as Farley and the Dentonvale staff celebrate having just committed the entire town of Denton to the terminal ward in Dentonvale ('Denton, U.S.A. Reprise').