Set in turn of the century New York, the story begins one Sunday afternoon at the home of dentist Biff Grimes (James Cagney), where we find him playing horseshoe with a friend. Later he is about to take a walk with his wife when he receives a phone call from a patient suffering from a toothache. Saying he won't work on Sunday, Biff refuses to see the man -until he finds out the patient is Hugo Barnstead (Jack Carson), his arch nemesis (Hugo doesn't know Biff is the dentist). The call prompts Biff to recall where his trouble with Hugo started, ten years ago in the old neighborhood.
At the time, Biff and Hugo were on friendly terms, but both vied for the affections of the dream girl of every man in town, "The Strawberry Blonde", Virginia Brush (Rita Hayworth). Hugo makes her acquaintance and they arrange a double date. Hugo invites Biff to be Virginia's friend's escort. This friend is Amy Lind (Olivia De Havilland), a "freethinking" feminist. Her ideas about equality for men and women scare Biff off. He can't wait for the date to be over, but the prospect of being near Virginia again makes him agree to another double date the next day. The foursome plan to take a boat ride, but as luck would have it, the maximum amount of passengers allowed on board is reached just as Hugo and Amy step on deck. Biff and Virginia are left together on dry land. They enjoy a lovely day together and Virginia agrees to go out with him again, "three weeks from Wednesday".
When the agreed upon date arrives, Biff goes to the park to meet Virginia. She never shows, but Amy does. Shortly after, friends pass by and break the big news to Biff -Virginia married Hugo Barnstead that afternoon. Biff is very upset but Amy is there to calm him down. After talking to her, Biff realizes that her feminist talk is just that -talk. She's really an old-fashioned girl, a characteristic that appeals to Biff. They become a steady couple.
We are then taken forward a few years. Biff and Amy are married and Hugo has become a successful businessman. One day Biff has a chance meeting with Virginia and she invites he and Amy over for dinner. Virginia convinces Hugo to make the down-on-his-luck Biff an executive in his company. After a few years of marriage, Virginia has become fed up with her egotistical husband. When the Grimes' come over for dinner, Virginia takes advantage of a power outage by planting a kiss on Biff. The following day, Biff arrives for work as vice president of Hugo's contracting company. He spends his days reading the newspaper and signing documents Hugo tells him to sign. Then one day, one of Hugo's buildings collapses. Vice president Biff Grimes is held responsible -because his signature had appeared on the building contracts. Hugo gets off scot-free and Biff is given a five-year prison sentence for graft. Upon his release, Biff goes back to normal living with Amy.
We now skip ahead to Biff's present-day life, to his office where he anticipates seeing Hugo writhing in pain over a bad tooth. Soon after, Hugo and Virginia arrive, fighting like cats and dogs. Biff gets back at Hugo by yanking out his tooth, without anything to numb the area. Virginia delights in Hugo's agony. They leave Biff's office bickering as usual. Seeing how unhappy Virginia and Hugo's marriage is, Biff realizes he got the better girl. The story closes with the news that Biff and Amy will soon become parents.