The 20-year-old Grand Duchess, who has been brought up by her tutor and court chamberlain Baron Puck to have her own way, is charming, though a veritable tyrant. She has been betrothed to the foppish Prince Paul but does not find him to her liking and, owing to her being in an unhappy state of mind over the affair, the Baron generates a war to amuse her. She decides to review her troops. There is a roll of drums, and the cry is started that the enemy is advancing, but it turns out to be her Highness.
This visit proves fateful, for she falls desperately in love with the manly, handsome soldier Fritz, whose main passions in life are his love for the pretty Wanda and his hatred of General Boum. The Duchess immediately makes Fritz a corporal, and as she grows more and more delighted with him, he is promoted rapidly to sergeant, lieutenant and captain. Finally, to spite the General, she makes him commander-in-chief and sends him to conquer the enemy.
Fritz wins the battle easily by making the whole opposing army drunk, his artillery consisting of 300,000 well-filled bottles. When he returns, crowned with victory, the delighted Duchess finds herself more enamored of him than ever, and hints at the possibility of his receiving other honors. However, she finds him a great blockhead in the matter, for he shows that he prefers his Wanda to such distinctions, and he incurs the Duchess's great displeasure by asking permission to marry Wanda at once. This proves the death-blow to the Duchess' devotion, and she conspires to assassinate Fritz upon his return from the wedding ceremony.
When everything is ready for the bloody deed, however, the Duchess changes her mind, which is now busied with a new affair with the Baron Grog. Her love life seems to be forever ill-starred, however, for this latest romance is blighted by the news that her beloved has a wife and four children. The Duchess becomes philosophic and decides to marry her original betrothed, Prince Paul, after all. To quote her own words, "What can one do? If you can't have those you could love, you must try to love those you can have."
Instead of assassinating Fritz, the Duchess devises the lesser punishment of noisy serenades during his wedding night, and then hurries him off on a false alarm to fight the enemy. The enemy proves to be a jealous husband who mistakes him for another man and gives him a caning. Fritz is stripped of his military ranks, but he can now leave the army, return to Wanda, and become a village schoolmaster, albeit a rather illiterate one. General Boum is made happy by the restoration of his command; Baron Puck is reinstated to the royal favor from which he had meanwhile fallen; Baron Grog is sent home safe to his wife and four children; and Prince Paul is happily restored as the Duchess's bridegroom.