Count Waldner hopes to marry his daughter Arabella off to a wealthy man to save the family from ruin. The younger daughter, Zdenka, is being reared as a boy – they can't afford to keep two young ladies in accordance with their station. Time is running out. The hotel are threatening the family with eviction. ACT 1 Waldner's wife's fortune-teller predicts that Arabella will marry a mysterious stranger. Zdenka hopes Arabella will choose Matteo, who confides in who he believes to be Arabella's younger brother. Zdenka, who loves him, writes him love letters in Arabella’s name to ease his mind. Arabella saw a stranger watching her enter the hotel. Elmer, one of three counts wooing her, arrives. Considering himself the victor in the contest for Arabella’s hand, he invites her for a sleigh ride. Arabella accepts, on condition that Zdenko comes with them. She looks out the window and sees the mysterious man again. He is the nephew of an old friend of Count Waldner, to whom he had written offering his daughter’s hand in marriage. After his uncle's death Mandryka found the letter & Arabella's picture, fell in love with her and travelled to Vienna. Mandryka asks for Arabella's hand in marriage, without having met her, and then gives Waldner a lot of money. They decide to meet at the Coachman's ball that evening. Arabella dreads having to choose a husband that night. ACT 2 Arabella and Mandryka hit it off immediately. She is prepared to go with him but asks for one last hour to say goodbye to the three counts. Mandryka hears Zdenka tell Matteo to go to Arabella, but it is Zdenka who will be waiting for Matteo in Arabella's room. Mandryka insults the absent Arabella in front of the guests. Her father insists that they return to the hotel immediately. ACT 3 Matteo has been making love to Zdenka in the dark, thinking she was Arabella, so he is confused when he meets the real Arabella in the hotel lobby. Her parents and Mandryka show up. Mandryka feels justified in his contempt for Arabella for her betrayal. Arabella is deeply offended by Mandryka's behaviour. Honour demands that Mandryka and Matteo fight a duel. Zdenka reveals that she is a girl and confesses to spending the night with Matteo. Mandryka is now eager to see Matteo and Zdenka united, hoping that Arabella will then forgive him. Arabella postpones all further conversations until the next day. Mandryka believes he has lost her forever. Arabella returns, handing him a glass of water, as is the custom in his home village, sealing their engagement.