On his first morning, the sardonic, wise-cracking, all-wise "seasoned" maid Molly (Jean Dixon), gives him a run-down on the family and warns him that he is the just the latest butler (in a long line of butlers) that has worked for the zany household:

Molly: There's one every day at this hour. They're dropping in and out all the time.
Godfrey: Why is that?
Molly: Some get fired, some quit.
Godfrey: Is the family that exacting?
Molly: No, they're that nutty.

As Godfrey authoritatively goes about his rounds throughout the film, the quirks of the mindless and artificial Bullock family members are repeatedly displayed. The "battle-axe," hung-over, half-awakened, babbling Angelica is dazed. She has forgotten who he is, and is gently reminded:

Godfrey: I'm the forgotten man.
Angelica: So many people have such bad memories.
Godfrey: That's so true.

Mrs. Bullock sees "pixies": "I don't like them, but I don't like to see them stepped on." To combat them, he gives her a tall glass of tomato juice ("pixie-remover") spiked with Worchestershire sauce ("a counter-irritant"), and eliminates their true cause - a breeze blowing across glass wind chimes.

Behind the second door, "lioness" Cornelia ("a sweet-tempered little number") rejects delivery of breakfast in bed. In the third bedroom, an "insidious" and deranged Irene, with a collared negligee, greets him with the breakfast as "the cutest thing I've ever seen" and encourages him to sit on the edge of her bed - telling him how "terribly thrilling" it is to have sponsored him as her "first protégé," an arrangement similar to the way "pianist" Carlo is her Mother's protégé:

Irene: You're more than a butler. You're the first protégé I ever had.
Godfrey: Protégé?
Irene: You know, like Carlo.
Godfrey: Who is Carlo?
Irene: He's Mother's protégé.

She brainlessly tells him: "You don't know how nice it is having some intelligent person to talk to." As he leaves, she remembers: "You're my responsibility" and tosses a go-away line at him: "See you in church."

The long-suffering, put-upon father of the family, Mr. Bullock accepts another subpoena from a process-server (Eddie Featherston) for his daughters' costly, late-night antics: "Life in this family is one subpoena after another." From Godfrey's perspective, butlering for the "entertaining" Bullocks is "more desirable than living in a packing case on a city dump." However, the bitchy, ice-cold Cornelia demands that he clean her shoe with his handkerchief, and then pledges to make his butlering-life miserable: "When I get through with you, you'll go back to your packing case on the city dump and relish it. People don't make a practice of pushing Cornelia Bullock into ashpiles. I'll make your life so mis-..." Already infatuated with Godfrey, Irene is protective of him although her bitter rival-sister exposes and mocks her romantic intentions in their non-stop sibling rivalry:

So Little Red Riding Hood didn't have enough feminine charms to trap a wolf her own age, so she falls in love with the butler and lives happily ever after on an ashpile - if you know what I mean.

The whole family of feather-brained socialites has gathered in the drawing room where Angelica has a treasured, ribboned-pet dog in her arms. The grumpy father Alexander feels buffeted by the members of his frivolous family, the do-nothing and pretentious Carlo, and the government and complains about the financial ruin brought upon him, as scrounger Carlo moans:

Oh, Money, money, money! The Frankenstein Monster that destroys souls.

As Carlo goes to the window with arms extended and his back to the room, Alexander pronounces a cure for their profligate spending and craziness: "There's one thing I do know. What this family needs is discipline. I've been a pretty patient man, but when people start riding horses up the front steps and parking them in the library, that's going a little bit too far...This family's got to settle down!"

During the outrage as Godfrey dutifully serves hors d'oeuvres on a tray, Cornelia insults her sister for picking up "strays": "How about this business of certain people picking up anybody they find on the city dump and dragging them into the house? For all we know, we might be stabbed in the back and robbed." Carlo forgets his misery over pecuniary matters when reminded by Angelica to "get some nice hors d'oeuvres." Upset by her sister, Irene's face crumples into blubbery tears with fears of losing Godfrey: "If Mother can sponsor Carlo, why can't I sponsor Godfrey?" With another inane line of dialogue, Angelica affirms her daughter's affection with Godfrey: "He's the first thing she's shown any affection for since her Pomeranian died last summer."

Irene collapses on the living-room couch, consumed by tears and self-pity. Subsequently, Cornelia accuses her of putting on a show: "She's not having a spell. That's old stuff." To cheer up and "amuse" Irene, Carlo reluctantly does a gorilla imitation [a role that he has routinely performed for the family] - hunched over, ambling and loping around the living room, and jumping up and over the furniture and onto the window frame. Irene reacts with phony fear at his ape mimickry: "He frightens me," while Mrs. Bullock attempts to calm her: "You mustn't be frightened. He isn't a real gorilla. He's just playing." Alexander is flummoxed by Carlo's absurd pantomime: "Why don't you stop imitating a gorilla and imitate a man?...Someday I'm going gorilla-hunting and I won't miss." At the end of Irene's moping bout as she lies on the couch, she reaches up, takes Godfrey's hand as he bends over her, and whispers a confession that she isn't really having a spell - and then plants a kiss on his mouth! Embarrassed, he clicks his heels and retreats in shock.

In the next scene, Carlo accompanies himself on the piano while practicing and singing Otchi tchornia for Angelica. Godfrey brings a flower delivery of roses for a disconsolate Irene, who is hosting an afternoon tea party and assuming tragic poses throughout the room: "What difference does it make where one puts flowers when one's heart is breaking?...Life is but an empty bubble....Why should anyone be cheerful?...What difference does it make? Some people do just as they like with other people's lives and it doesn't seem to make any difference." Cornelia comments on her sister's gestures as she stands dramatically next to open French doors and a tall pedestal in the room: "Oh, I remember that pose so well. I learned it in dramatic school. It's Number Eight, isn't it?...Am I spoiling your act, dear?"

During the party, Cornelia further pesters her spoiled, love-sick, heartbroken sister: "The servant problem's been bothering her lately." As Godfrey serves hors d'oeuvres to one of the guests of the family, Tommy Gray (Alan Mowbray) recognizes him as a wealthy, heir-to-a-fortune classmate from his past: "Godfrey Parke, you old mug...We went to Harvard together." When Gray threatens to expose his background to the Bullocks, Godfrey hushes him. Gray pretends that he hired Godfrey as his valet at school - until he can learn the full story at lunch the next day. Cornelia is amazed by the revelation: "Imagine a butler with a college education!" When Gray announces as part of the fabrication that Godfrey was married to an Indian wife and had five children, Irene spitefully retaliates and announces her engagement to a fatuous old flame Charlie Van Rumple (Grady Sutton). But Irene soon breaks down in tears and flees to the stairs after being politely congratulated by Godfrey. As he passes by the stairs later, she watches him through the columned-railing of the stairs - chewing on a black handkerchief, pulling it through her teeth, and then wiping her nose with it.

Over breakfast the next day, the gentlemanly and courtly Godfrey expresses his pride in his work to Alexander: "I'm proud of being a good butler, sir. And I may add, sir, a butler must be good to hold his job here." Alexander quizzically asks: "Say, who are you?" Over lunch at a restaurant, Tommy Gray is anxious to know the "dirt" about his former Harvard pal - of the prestigious "Parkes of Boston":

Don't avoid the issue. I've been sitting here like a snoopy old maid with her ears flapping in the breeze waiting to hear the dirt...Well, when I wandered into a Fifth Avenue asylum and see one of the Parkes of Boston serving hors d'oeuvres, I think I'm entitled to a palpable curiosity...But I still want to know why you're butlering when your family's telling everybody that you're in South America doing something about rubber or sheep or something...I'd like to see their faces when they find out that you're a butler.

Godfrey explains that a broken, unhappy love affair (presumed) in Boston had made him depressed and "pretty bitter" and cascaded him down to a lower station in life. On the brink of despair and suicide, he almost killed himself:

...gave her everything I had and just disappeared. You know, the Parkes were never educated to face life. We'd been puppets for ten generations...Boy, did I feel sorry for myself. I wandered down to the East River one night thinking I'd just slide in and get it over with. But I met some fellas living there on a city dump. Here were people who were fighting it out and not complaining. I never got as far as the river.

His suicidal impulses were broken by the optimistic, dauntless attitudes of down-and-out men living at the dump, and his spirit was rekindled. In jest, Gray suggests that Godfrey see a "brain specialist" to be examined. Eavesdropping on him in the same restaurant, the sleek and predatory Cornelia suspiciously questions his "chummy" attitude toward Gray, and mentions that she heard his name might be Parke instead of Smith. She makes a play toward him: "Are we going to be friends?...You really like me and are afraid to admit it, aren't you?" He deftly deflects her advances by attacking her with a "portrait" of her bratty character:

You belong to that unfortunate category that I would call the Park Avenue brat. A spoiled child who has grown up in ease and luxury and who has always had her own way and whose misdirected energies are so childish that they hardly deserve the comment even of a butler on the off-Thursday.

Disdainful, she leaves - determined to end his employment: "I'll see you down at the ashpile."

In the kitchen of the Bullock mansion, as Molly sews buttons on Godfrey's pants, Irene strokes the pants-leg while they both reveal their unrequited love of him and deteriorate into each other's arms in wallowing tears:

Irene: It's his, isn't it? Do you always sew his buttons on?
Molly: Sometimes.
Irene: Oh, I'd like to sew his buttons on sometime when they come off. I wouldn't mind at all.
Molly: He doesn't lose very many.
Irene: Oh, he's very tidy.
Molly: Yes, he's very tidy.
Irene: What does he do on his day off?
Molly: He never tells me.
Irene: (in tears) Oh, he's probably sitting somewhere with some woman on his lap. He's the meanest man I know.
Molly: I think he's very mean.
Irene: I suppose he's sitting somewhere with somebody in his lap who doesn't care for him at all. As far as I know, maybe his children are calling him. Calling him - oh, I can't bear it.
Molly: Please don't. (She stands and walks away)
Irene: You too? Oh Molly, I know exactly how you feel. (They hug and tearfully commiserate with each other)

Returning home from the restaurant on his day off, Godfrey enters the kitchen - resembling a drunken version of Charlie Chaplin's Tramp character from Modern Times (1936).

In the living room, Carlo reads from Tennyson's The Lotos-Eaters to Mrs. Bullock, who denies the fact of Irene's tears by exclaiming that she was eating onions in the kitchen: "You know, sometimes I wonder if my children are all there." In her planned conspiracy against Godfrey, Cornelia accuses him of not obeying orders, such as forgetting to send her gray satin evening dress to the cleaners. After reading a newspaper story about a man drowning his wife in the bathtub, Angelica expresses her affectionate love toward her pet dog: "If anyone ever drowned my 'booful' in the bathtub, his mama would be very, very cross, yes she would." Tipsy from his afternoon cocktails with Gray, Godfrey mistakes Angelica for Cornelia and compliments her by flattering her vanity: "I hope you'll forgive me, madam, but you seem to be looking younger every day, if I may say so."

While Godfrey is away from his quarters, Cornelia sneaks into his room, opens up a dresser drawer (and conspicuously leaves it open!), and plants her expensive pearl necklace under his mattress (without completely straightening the cover on the bed) - a frame-up so that he will be caught for theft and punished for not accepting her advances. During dinner that evening, Cornelia announces that her sister Irene refuses to eat ("Nobody cares if I starve myself to death...I don't mind dying if other people don't") because she is "in love." Alexander mocks ravenous Carlo's "genius" musician skills as a pianist: "He ought to be strong enough soon to give that concert...He could give a bang-up concert right now with a knife and fork."

As part of the set-up of the butler, Cornelia dramatically announces that her expensive pearls are missing from her dressing table - and she has already called the police. The detectives (Edward Gargan and James Flavin), believing it's "an inside job," are led straight to Godfrey's room by Cornelia. Protective of the befuddled butler, Irene becomes hysterical: "Godfrey, you've got to hide them. Here come the cops!" Cornelia suggests the obvious place: "Look under the mattress!" but when the pearls aren't found there, she exclaims: "They must be there!" and obviously incriminates herself. Realizing the frame-up that his outrageous daughter has orchestrated, Mr. Bullock apologizes to Godfrey and then to the police as he escorts them out and the incident is forgotten: "I'm terribly sorry, boys. I want to apologize for my family. They're all slightly hysterical." He scolds Cornelia for her duplicity: "If you don't find your necklace, the joke's on you because it's not insured." Irene laughs at her smug, disgraced sister.