To keep up the pretenses with Arthur and to have him meet the family, Alice's mother encourages her daughter to invite her beau to have dinner in their home:

Why, I actually don't believe he's ever been inside the house...Why don't you see, Alice? It seems so queer not to do something. Why, it looks so kind of poverty-stricken...We could get that colored woman, Malena Burns to wait on table. She goes out for the day, you know. And then we could have a nice dinner, something real stylish.

During a high-brow dining room scene at the Palmers mansion - in their 'cousin' Arthur's presence, Mr. and Mrs. Palmer assent to their daughter's invitation list for a garden party, pausing with some concern on the name of Alice Adams - "rather a conspicuous young woman." Mr. Palmer (Jonathan Hale) recollects hearing that Alice's father had "stolen some sort of a glue formula from Mr. Lamb...Yes, it quite upset the old gentleman. Adams had been his clerk for over twenty-five years and Lamb's been carrying him along even though he'd been dead weight to the firm. And then, to show his gratitude this man Adams up and walked off with the glue formula...You know the point of this thing is that Lamb takes a great deal of pride in his judgment of men and everybody thinks this is a great joke on the old man. All he can say is 'Wait and see,' 'Wait and see.'" Mildred rates Alice as: "not unattractive in a way. A pushing sort of girl."

The highlight of the film is the classic, tragically funny, disastrous dinner-party scene. The aspiring, pretentious Alice hopelessly wishes to rise up above the low-social prominence of her vulgar, poor family. To impress Arthur, her rich new suitor, she has planned a "stylish" dinner party at her own home - in the wilting humidity and heat - she fiercely wishes to make a good impression by having conned Arthur into believing that her folks are well-to-do. She has fictionalized her life to him and forced everyone in her family to pretend that they are something other than themselves.

The part-time hired black servant/cook Malena (Hattie McDaniel) has been coached to make it a first-class event, and Mrs. Adams vows: "I do want things to be so right." With little time to spare, Alice once more readjusts the worn-out furniture in the living room. A stiff-fronted tuxedo has been rented for Mr. Adams. Malena tumbles down the cellar stairs at the exact instant that Arthur rings the front door bell. Mrs. Adams bumps into the dinner guest after escorting him into "our own little home" and following too closely, and soon after apologizes for her "informal" appearance due to the maid's "accident." She chatters away, priding herself on her daughter's "amiable" personality, and arguing that "character" is an important trait:

And I think that character is the most important thing in the world, after all...She never can see any good in herself. She always sees good in everybody else no matter how unworthy they are. She always underestimates herself...But she is such a dear child.

In one long sweeping motion, Alice descends the front staircase, followed by her father. With her lace maid's cap continually falling off her head, the slovenly, gum-chewing, incompetent and drunk Malena valiantly makes a mess of things during the appetizer course while serving caviar sandwiches - in slow-motion. Virgil crunches into the crumbling, dry cracker spread with caviar. According to Alice, "we never have liquor in the house. Father's a tee-totaler." After prying open the stuck, sliding dining room doors, Malena inelegantly announces: "Dinner is served." Alice's father responds: "Well, that's good. Let's go see if we can eat it." Mrs. Adams elegantly covers up: "Shall we go in?"

Although it is a sweltering, humid night, hot soup is the first course of the elaborate meal. The tuxedo shirt front keeps popping open as Virgil struggles to spoon soup into his mouth. The sullen maid Malena kicks open the kitchen door and removes the soup plates before the diners are finished. Ill-at-ease and sweating profusely, Arthur plays with his mushrooms and sweetbreads course, but politely compliments the hosts: "This is my favorite dish." Alice chatters and smiles away, trying to make a good impression as an appreciative gourmet, while blaming the cook for the inappropriate choice of foods on a hot day. But she is internally panicked and embarrassed by the gauche, humiliating behavior of her family. The mashed potatoes and filet course ("heavy entree") is next. The Brussels sprouts, which have smelled up the house, are thrust at everyone as an additional vegetable. Malena retrieves a stray sprout that falls to the table with a trowel. Having forgotten the maid's name, Virgil calls "Here you" when he requests water to drink from "that colored woman." The dessert course is melted ice cream, served with hot coffee.

Suddenly, Alice's absent brother abruptly arrives and demandingly gestures for his father away from the table. To cover up what she knows is a blatant disaster, Alice peppers Arthur with question after question, without allowing him time to answer:

What are your talents, Arthur? Can you play any instrument - or sing - or paint? Or perhaps you have some secret hobby that derives its unique charm from just being secret? Something you keep all to yourself and don't like to talk about.

Mrs. Adams excuses herself to investigate the loud altercation between Walter and her husband. With tears welling up in her eyes, Alice asks Arthur: "A penny for your thought. No, I'll pay more," and offers him a "poor, little dead rose" from the centerpiece as further payment. Obviously, she knows that he has seen the pathetic reality of her bumbling, cloddish family, but he replies: "I'm afraid I haven't any." Tremulus and vulnerable from worry, she pleads as she wipes her tears:

Alice: Will you ever forgive us...for making you eat such a heavy dinner?..Cheer up. Your fearful duty's almost done and you can run on home as soon as you like. That's what you're dying to do, isn't it?
Arthur: Not at all.
Alice: You're upset about something.
Arthur: No, I'm not.
Alice: Whatsa matter, little boy? Tell Ali..
Arthur: Nothing.
Alice: Let's go out on the porch where we belong, shall we?

They retreat to the porch outside, "where we belong," where Alice, disliking herself, presses to determine what is wrong and then supplies her own answer. She directly asks him to leave because their romance is "spoiled" and she believes he won't be coming back again to see her:

Alice: Maybe it's this ugly little house, or the furniture, or Mother's vases that upset you. Or was it Mother herself or Father?
Arthur: I've told you, nothing upset me.
Alice: You say that because you're too nice or too conscientious or too embarrassed. Anyhow, too something to tell me. I wonder if they've done it after all.
Arthur: Done what?
Alice: I wonder who's been talking about me to you after all. Isn't that it?
Arthur: Not at all.
Alice: Don't say 'Not at all' again. You're not good at deceiving.
Arthur: I'm not deceiving...
Alice: Never mind. Do you remember saying that nothing anybody else could do would ever keep you from coming here? That if you left me, it would be because I'd driven you away myself.
Arthur: Yes, and it's true.
Alice: But I haven't driven you away - and yet you've gone.
Arthur: Do I seem as silly as all that?
Alice: I wonder if I have driven you away.
Arthur: You've done nothing.
Alice: I wonder. You know, I have the strangest feeling. I feel as if I were only gonna see you about five minutes more all the rest of my life.
Arthur: Why, that's silly. Of course I want to see you all...
Alice: No! I've never had a feeling like this before. It's just so, that's all. You're never coming here again. Why it's all over, isn't it? Why it's finished, isn't it? Why, yes...Yes, you must go. There's nothing else for you to do. When anything's spoiled, people can't do anything else but runaway from it. Goodbye.
Arthur: We'll only, only say goodnight.

Alice valiantly closes the door on him and trudges up the stairs. The family has been engaged in a heated argument upstairs, because Walter has been discovered embezzling money ($150) from his father's former employer J. A. Lamb's drug company where he is employed ("Walter's short in his accounts down at Lamb"). He hints at an abortion for a girlfriend ("A friend of mine got in a jam. He told me he'd give it to me by the end of the month and he didn't do it. The auditor has already started checkin' on the books down at the office"). Mrs. Adams fears that Walter will be sent to jail. Distraught that his dreams of a successful glue factory may be lost and that Lamb will believe he's been cheated again by a second member of the Adams family, Virgil decides to cover it up and repay Lamb, although it will bankrupt him: "I'll put a loan on my glue factory."

As he reaches the front door, Mr. Lamb arrives to pay a visit to the Adams household. The hard-headed, not-to-be-topped Mr. Lamb informs Virgil that he intends on opening a second glueworks factory of his own - "Yes, and a big one!...Yes, and very convenient to your place, too. In fact, right across the street...What did you expect me to do, Virgil Adams? Let you walk off with my glue formula like swallowing a pad of butter." Although Virgil asserts that the formula was a shared possession: "It was just as much mine as yours," and then claims that he was a loyal, hard-working employee at Lamb's - now he (and his family) will be "ruined" by Lamb's competition. Virgil concludes by impertinently denouncing Lamb as "a doggone mean man."

Alice tremulously and tearfully intercedes on her father's behalf, sensibly explaining her father's motivations to defect (by blaming herself and her mother), and volunteering to work to pay back her brother's debts:

Alice: You can't go thinking that badly about dad. He was so upset he didn't know what he was saying.
Mr. Lamb: Upset, I shouldn't wonder, the dang ol' fool.
Alice: Yes, I guess he is an old fool...
Mr. Lamb: What?
Alice: For listening to mother and me. It's all my fault, this whole terrible mess...Mom was always after Dad and after him to make more money for me so that I could compete with the other girls in this town. I guess parents will make any sacrifice to see their children happy and when Dad saw how unhappy I was, he just did what he did. He always wanted to go back to work for you. I guess he almost worshipped you, Mr. Lamb. If you'll just give me time, I'll get a job and make some money and pay you back what Walter owes you, really I will. I know I haven't had much experience, but I can do things. I was good at English and arithmetic at school. I won a prize in English once. And I know I'd make a good secretary for someone.

Lamb is convinced of her sincere, common-sense plea and ventures upstairs to forgive Virgil and work out a conciliatory deal with him for a partnership in a joint glue-factory enterprise, while realizing that his ex-employee was "forced into this thing by circumstances...If you and I have been transgressing against each other, I think it's about time we quit such foolishness...Suppose you come down to the office as soon as you're good and fit and we'll try and work something out. And I guess, maybe together, we ought to be able to show the world something about glue. Then we'll talk about Walter too." After Mr. Lamb leaves, Virgil gratefully thanks his daughter and compliments her choice of boyfriend:

He's a fine young man, Alice. The nicest and quietest you ever had. And I know he likes you just for your own sake. And not on account of any dang glueworks or anything else.

After "enough excitement for one night," Alice quietly extinguishes the hall light as she goes back downstairs and turns off another living room light. She walks back out to the porch for fresh air and to gaze into the stars. The camera rests on her as she hears an off-camera voice: "A penny for your thoughts. No, a poor little dead rose for your thoughts, Alice Adams." Arthur has remained behind on the porch swing, although he has overheard everything. Despite logic and through her sheer determination, even though he knows the whole truth and in spite of everything, he professes his love for her on the front porch at the end of the evening:

Alice: You came back.
Arthur: I didn't go.
Alice: Why?
Arthur: I've been waiting for you.
Alice: Then you heard...
Arthur: Yes, I heard everything. And what's more, I...
Alice: But I...
Arthur: (assertively) Stop it! Let me finish. I heard a great deal at Mildred's this afternoon, too.
Alice: So they did talk about me.
Arthur: Yes, they talked about you alot. And I found out one thing. I love you Alice.
Alice: Gee Whiz!
Arthur: I love you. (They kiss.)

[Note: She wins his hand, in a tacked-on, unrealistic ending that was added by the scriptwriters to provide a fairy-tale, upbeat denouement.]