The play is set in Bath in the 18th century, a town that was legendary for conspicuous consumption and fashion at the time. Wealthy, fashionable people went there to "take the waters", which were believed to have healing properties. Bath was much less exclusive than London, and hence it provides an ideal setting for the characters.
The plot centres on the two young lovers, Lydia and Jack. Lydia, who reads a lot of popular novels of the time, wants a purely romantic love affair. To court her, Jack pretends to be "Ensign Beverley", a poor officer. Lydia is enthralled with the idea of eloping with a poor soldier in spite of the objections of her guardian, Mrs. Malaprop, a moralistic widow. Mrs. Malaprop is the chief comic figure of the play, thanks to her continual misuse of words that sound like the words she intends to use, but mean something completely different. (The term malapropism was coined in reference to the character.)