Songwriter Jack Morell gets a break DJing at local disco Saddle Tramps. His roommate Samantha Simpson , a supermodel newly retired at the peak of her success, sees the response to a song he wrote for her ("Samantha") and agrees to use her connections to get him a record deal. Her connection, ex-boyfriend Steve Waits , president of Marrakech Records , is more interested in getting back with her than in Jack's music , but agrees to listen to a demo.
Samantha decides Jack's vocals won't do, and recruits neighbor and Saddle Tramps waiter/go-go boy Felipe Rose , fellow model David "Scar" Hodo (the construction worker, who daydreams of stardom in the solo number "I Love You To Death"), and finds Randy Jones on the streets of Greenwich Village, offering dinner in return for their participation. Meanwhile, Simpson's former agent Sydne Channing orders Girl Friday Lulu Brecht to attend, hoping to lure the star back. Ron White , a lawyer from St. Louis, is mugged by an elderly woman on his way to deliver a cake Samantha's sister sent, and shows up on edge. Brecht gets Jack high, which unnerves him when her friend Alicia Edwards brings singing cop Ray Simpson, but Jack records the quartet on "Magic Night". Ron, pawed all night by the man-hungry Brecht, is overwhelmed by the culture shock of it all, and walks out.
The next day, Samantha runs into Ron, who apologizes, proffers the excuse that he's a Gemini, and follows her home. Spilling leftover lasagna on himself, Simpson and Morell help him off with his trousers before Morell leaves and Simpson and White spend the night. Newly interested in helping, Ron offers his Wall Street office to hold auditions. There, Glenn M. Hughes, the leatherman climbs atop a piano for a rendition of "Danny Boy", and he and Alex Briley, the G.I. join up. Now a sextet, they get their name from an offhand remark by Ron's socialite mother Norma . Ron's boss, Richard Montgomery, overwhelmed by the carnival atmosphere, insists the firm not represent the group, and Ron quits.
Ron's new idea for rehearsal space is the YMCA, where a production number set to the song "YMCA" features its athletic denizens in various states of undress (the film is one of the few PG-rated offerings to feature male full frontal nudity). The group cut a demo ("Liberation") for Marrakech, but Steve sees limited appeal and Samantha refuses his paltry contract. Reluctant to use her savings, they decide to self-finance by throwing a pay-party.
To bankroll the party, Samantha acquiesces to Channing's plea to return for a TV ad campaign for milk, on the condition the Village People are featured. The lavish number "Milkshake" begins as Simpson pours milk for six little boys in the archetypal costumes with the promise they'll grow up to be the Village People. The advertisers want nothing to do with such a concept, and refuse to air the spot. Norma then steps in to invite the group to debut at her charity fundraiser in San Francisco. Samantha lures Steve by promising a romantic weekend but Ron is taken aback by the inference she'd go through with the seduction, and Samantha breaks up with him. On his private jet, Steve prepares for a tryst but it's Jack and his former chorine mother Helen who show up, to hash out a contract. Initially reluctant, Helen seduces Steve with her kreplach and before long they're negotiating the t-shirt merchandising for the Japanese market.
In the dressing room before the show, Ron is relieved to learn Samantha didn't travel with Steve, and proposes. At one point, Montgomery shows up to rehire Ron as junior partner representing the group. Following a set by The Ritchie Family ("Give Me a Break"), the Village People make a triumphant debut, singing "Can't Stop the Music" to a cheering crowd.
