Chuck Rodwell is a gambling cowboy who discovers that he's lucky at the roulette wheel if he holds hands with dancer Marie. However, Marie doesn't like to hold hands with him, at least not in the beginning...
Nancy Willows (Constance Towers), pretty blonde high school teacher, writes song lyrics which spark the careers of struggling young pianist-composer Martin Adams (Keefe Brasselle')and would-be singer Jerry Dennis (Frankie Laine). When Nancy and Martin fall in love but quarrel over her old flame, David Parker (William Leslie), Nancy returns to her teaching job. Jerry reunites Nancy and Martin and, in turn, succumbs to the charms of his new secretary Marge Stevenson (Lucy Marlow).
When You're Smiling is distinguished by the presence of several top recording artists of 1950. The wafer-thin plotline concerns the misadventures of Texan Gerald Durham (Jerome Courtland), who arrives in the Big City to learn the ropes of the music business. Durham not only ends up with a recording contract, but also wins heroine Peggy Martin (Lola Albright) in the bargain. So much for the story. The principal selling card of When You're Smiling consists of the guest-star turns by Frankie Laine, Bob Crosby, The Modernaires, The Mills Brothers, Kay Starr and Billy Daniels.
Liza Lee, fast-talking press agent for Al Jarvis, persuades Jarvis to stage a Musical Mystery Contest, with a $5000 prize to the person who can first name the most musical numbers and their performers. Lots of musicians perform.