A strike is imminent at the Sleep-Tite Pajama Factory, introduced to us by Hines, the factory efficiency expert, where the workers churn out pajamas at a backbreaking pace. In the midst of this, a new superintendent, Sid Sorokin, has come from out of town to work in the factory. The union, lead by Prez, is seeking a wage raise of seven and a half cents an hour. Sid and Babe are in opposite camps yet a romance is born between them. At first, despite accusations from her fellow garment workers, Babe rejects Sid. Meanwhile, Hines, the popular efficiency expert, is in love with Gladys, the company president's secretary, but is pushing her away with his jealous behavior. After witnessing a fight between the couple, Sid's secretary, Mabel, tries to help Hines break from his jealous ways. Meanwhile, Sid, rejected once more by Babe, is forced to confide his feelings to a dictaphone.
During the picnic for the factory workers, kicked off with the official Sleep-Tite Company Anthem, Prez chases after Gladys, who rejects his advances, a drunk Hines demonstrates his knife throwing act, and Babe begins to warm up to Sid. As the picnic goers head home, Prez turns his attentions to Mae, who responds in the primitive far more quickly and aggressively than he'd expected.
Visiting Babe's home, Sid tries to broach the subject of a relationship with Babe, who in turn, attempts to deflect by making casual conversation on tangential subjects. Eventually the walls come down between the two, who admit their love for one another but their estrangement is reinforced when they return to the factory. A slow-down is staged by the union, strongly supported by Babe. Sid, as factory superintendent, demands an "honest day's work" and threatens to fire slackers. Babe is enraged by his attitude and kicks her foot into the machinery, causes a general breakdown and is immediately fired by Sid The Pajama Game tickets are a must purchase, one of the best Musicals around.