Place: Roulettenburg, a fictional European spa resort
Time: The 1860s

Act 1
In the Grand Hotel garden, Alexei, tutor to the General's family, meets Polina, the General's ward, who is in debt to the Marquis. Alexei loves Polina, and informs her that he observed her directions to pawn her jewelry and gamble with the funds. However, he lost the money. The General is enamoured of the much younger demimondaine Blanche, and enters with her, the Marquis and Mr Astley, an Englishman. When asked about his losses, Alexei says he lost his own savings. He is chided that someone of his modest income should not gamble, but Alexei dismisses the idea of saving money with a caustic diatribe. Astley is impressed and invites Alexei to tea. The General then receives a telegram from "Babulenka" (literally a diminutive of 'grandmother'; she is, in fact, the General's aunt and Polina's grandmother) in Moscow. The General is hoping that Babulenka will die soon so that he can inherit her money and marry Blanche.

Polina is frustrated that she cannot repay her debts to the Marquis. While Alexei continues to protest that he loves her, she wonders if he has any other interest than greed. The General interrupts their conversation. Polina challenges Alexei to prove his love, and to see if he would truly do anything for her, by making a pass at a German Baroness sitting in the park. Alexei does this, to the anger of the Baron. In the ensuing fuss, the Baron and Baroness leave.

Act 2
In the hotel lobby, the General reproaches Alexei for his actions. Alexei is unrepentant, upon which the General dismisses him as his family tutor. The General then tries to obtain the help of the Marquis in preventing any appearance of a scandal. Mr. Astley enters, and explains to Alexei the General's concerns. Blanche had earlier asked the Baron for a loan, which upset the Baroness. Because of the high social status of the Baron and Baroness, the General is keen to avoid any sense of impropriety. Astley further explains that the General cannot propose to Blanche until he receives his share of the inheritance from Babulenka. Alexei begins to think that once Polina receives her own share of the inheritance, the Marquis will attempt to win her over.

The Marquis appears on the General's behalf, to try to mollify Alexei's behaviour. Alexei is contemptuous to the Marquis, until the Marquis produces a note from Polina, which calls on Alexei to stop behaving like a schoolboy. Alexei accuses him of making Polina write the letter and leaves in anger. The Marquis tells the General and Blanche that he was successful in subduing Alexei.

The General predicts Babulenka's death that same evening, but immediately afterward, her voice is heard, as she has arrived at the hotel, in good health. She greets Alexei and Polina with some affection, but at once she sees through the General and the others. She says that she has overcome her illness and plans to recuperate, and gamble, at the spa.

Act 3
At the casino, Babulenka has been losing her money at the roulette tables, and ignoring all pleas to stop. The General is despondent and sees his chances with Blanche diminish. After the Marquis tells just how much Babulenka has lost, the General suggests to summon the police but The Marquis dissuades him. Alexei arrives, and the General and the Marquis ask for his help to halt Babulenka's gambling losses. Prince Nilsky, another potential suitor to Blanche, then arrives and further enumerates Babulenka's losses. The General collapses, distraught, and then runs into the casino. Blanche departs with Nilsky. Alexei wonders of what will happen with Polina's family, after Babulenka's financial losses. Babulenka, exhausted and depleted of funds, wants to go home to Moscow. Babulenka asks Polina to come with her, but declines. The General bewails Babulenka's losses and his own loss of Blanche to Nilsky.

Act 4
In his hotel room, Alexei finds Polina, who has a letter from the Marquis. The Marquis says he is selling General's properties mortgaged to him, but will forgive fifty thousand for Polina's sake, and Marquis will consider their relationship as over. Polina feels this paying her off as an insult and wish she had fifty thousand to fling at Marquis's face. Alexei is deliriously pleased that Polina has turned to him for assistance.

Rushing to the casino, Alexei has a run of good luck, winning twenty times in a row and breaking the bank. After an entr'acte, the other patrons continue to talk about Alexei's run. Alexei returns to his room, yet he continues to hear the voices of the croupiers and the other gamblers. He then becomes aware of Polina who has been waiting for him. He offers her funds to pay the Marquis back. She refuses and asks whether he really loves her. When Alexei gives her the money, she tosses it back in his face and runs out. The opera ends with Alexei alone in the room, recalling obsessively his success at the tables.