In the fictional state of Rurislavenstein, the scene opens in the glittering and the splendour of the Prunksaal des Schlosses Hall of the Prince of Flausenthurn. Princess Helene and Lieutenant Niki of the Army had earlier became lovers and soon were married in the splendid hall whereupon the father of the Princess, Joachim decided the apparent heir to his throne. In spite of this, Lieutenant Niki appeared to be sceptical of the prospect of being a Prince as it was not financially beneficial nor does it come with the elevated status which he sought. The marriage has also raised a few eyebrows among the courtiers as Niki was just a common soldier and the choice of marriage has been a hasty one. Niki also distanced himself from the Prince's favour when the former acknowledged the hasty marriage and raised suggestions for a separate bedroom from the newly-wed Princess. It also appeared to the dismayed Prince that Lieutenant Niki favours his hometown of Vienna rather than the interests of the State. Lieutenant Niki then chooses to leave the palace secretly with his comrade Lieutenant Montschi for a pleasurable evening in the Beer-Garden. Through this troubled backdrop, a scheming Count Lothar, who is envious of Niki hatches a plan of betrayal.Act Two
At the Garten der Wirtschaft, Niki meets Franzi, a ladies' orchestra leader and is attracted to her. Franzi, apparently, has also had her heart won by him just as quickly as her criteria is that only a true Wienerin (Viennese) can do so. By the scheme of Count Lothar, the Prince and Princess Helene was also present at the same venue with the chambermaid Friederike von Insterburg. The Count also has eyes for Franzi, however, she gives him the cold shoulder. By that instance, Princess Helene and Franzi meets and the Princess gladly wants to know the Wienerin who has won her heart. The main waltz theme of the Walzertraum plays and Niki dances with the Princess Helene. Franzi, who watches the entire scene with a broken heart realises that Niki was actually the husband of the Princess.Act Three
Back at the Prunksaal des Schlosses Hall, Princess Helen discovers Niki's unhappiness at the marriage. It transpires that Niki longs for the Viennese customs which he grows up with. An immediate change of environment was implemented, including a change of dress code, furniture and even the meals. A new chambermaid schooled in the Viennese customs was also installed to take charge of the domestic matters. Niki, as expected, warms down to the new surroundings which comes close to his heart and soon willingly accepts Princess Helene without restrictions although he clearly misses the pretty Franzi. Franzi, however, wisely renounces her affection for Niki and all ends happily ever after.