The musical opens at the Royal Exchange. "London Town Carol" is sung, and lamps glow. Christmas is near, and all are awaiting the early close of the Exchange so that the holiday can officially start. From bankers to charwomen, all wish each other "A Jolly Good Time," looking forward to the holiday fun ahead. Mr. Smythe and his daughter, Grace, enter, looking for Ebenezer Scrooge, hoping that he will give them a bit more time to pay their mortgage. In a draft of cold wind, Scrooge enters with his clerk, Bob Cratchit. Mr. Smythe approaches Scrooge to ask for more time to pay – he needs money for his wife's funeral – but Scrooge denies the request and tells little Grace, "You'll learn soon enough, child, that Christmas is a HUMBUG!" When asked for charity for the poor, Scrooge replies, "Are there no prisons? Are there no workhouses?" Cratchit tells him about his sickly youngest son, Tiny Tim, but Scrooge pays little mind to him and grudgingly gives him Christmas off. Scrooge believes that charity has "Nothing to Do with Me," as he ventures home through the streets, encountering some of the denizens of the city and treating them all rudely. The funeral of Mrs. Smythe passes, giving Scrooge a chill.

We travel to Cratchit's humble home, where Bob Cratchit and his son, Tiny Tim, set off to buy the makings of their meager Christmas feast. Bob tells his son that "You Mean More to Me" than anything. Meanwhile, Scrooge meets his nephew, Fred, who invites him for Christmas dinner. Scrooge has never met Fred's wife, Sally. Fred assures his uncle that he wants nothing from him, but Scrooge sends him on his way.

Scrooge's harsh treatment of his fellow Londoners includes a sandwich board man, advertising a Christmas pantomime, a blind old hag and a lamplighter (all of whom we will meet again as the Ghosts of Christmas Past, Christmas Present and Christmas Yet-to-Be). He refuses to buy tickets to the pantomime, refuses to help the lamplighter and refuses to give alms to the blind old hag.

When he arrives at his home, he has a vision – the face of his deceased business partner, Jacob Marley. Later, in his parlor, the Ghost of Marley materializes, bound in chains that he, himself, forged. Marley conjures up all of the mournful ghosts of greedy former business associates, who scare Scrooge silly and try to convince him to change his ways ("Link by Link"). Marley tells Scrooge that he will be visited by three ghosts "who yet may stop you ending up like me."

The clock chimes one, and Scrooge is awakened by a visit from the Ghost of Christmas Past (who looks remarkably like the Lamplighter). The ghost sings of "The Lights of Long Ago" and shows Scrooge scenes from his past: his father being taken to jail for non-payment of debts and his separation from his mother and his beloved sister, Fan. Next, we see Scrooge at the age of twelve, saving every cent he earns, working in a boot factory. The young boy writes to Fan and dreams of "A Place Called Home," but Fan will die giving birth to Fred. Next, Scrooge is reminded how joyous he used to be at "Mr. Fezziwig's Annual Christmas Ball." Here, Scrooge realizes that an employer can make his workers happy. While the festivities continue, Scrooge watches his younger self, still filled with light, as he proposes to his beloved, Emily ("A Place Called Home").

Young Scrooge and Marley go into business, growing more ruthless as they become more and more successful. They turn on their former benefactor, jolly Mr. Fezziwig, and demand that he repay a debt to them. Later, Emily breaks off her engagement with Ebenezer, returning her gold engagement ring, which she feels he will value more than her. Desperate to end these painful visions, Scrooge chases the Ghost of Christmas Past away and is left desolate and alone.

The clock strikes two, and Scrooge is visited by the Ghost of Christmas Present (Sandwichboard Man.) The ghost presents Scrooge with a lavish array of Christmas treats, which all come to life and dance ("Abundance and Charity"). Next, the ghost whisks Scrooge off to Bob Cratchit's house, where the family enjoys "Christmas Together." "Christmas Together" continues with a visit to Fred's house, where everyone toasts Scrooge, despite his absence; finally, all of London celebrates love, friendship and family – the true joys of Christmas, "together, all over the earth." The ghost shows Scrooge how fragile Tiny Tim is; then he reveals two more children in a desperate state of need: they are Ignorance and Want. When asked if Tiny Tim will live, Scrooge is told that, if these shadows remain unaltered by the future, the child will die.

Scrooge begs to know what he can do to change the future, but the clock strikes three, and he is whisked to St. Paul's graveyard by the ominous Ghost of Christmas Yet-to-Be. (Blind Old Hag). Gravediggers are digging a grave. ("Dancing on Your Grave.") Scrooge doesn't know who has died.

A corpse is unceremoniously dumped from its bed while the undertakers strip the body of its clothes and bedclothes. Scrooge sees the Cratchit family grieving over the grave of Tiny Tim. Finally, he sees his own name on a gravestone and understands that he will die alone and unmourned. He vows to change his ways, "Yesterday, Tomorrow and Today." Scrooge has a miraculous vision of children singing like angels ("God Bless Us Every One"), but his joy is interrupted by the ghost, who tries to wrap him in a shroud and wrestle him into his own grave.

It is suddenly Christmas morning, and Scrooge wakes up, wrestling with his own bed sheets! Thrilled to realize that he hasn't missed Christmas, he gives a young boy money to buy a prize turkey. Dancing through the streets of London, Scrooge sings "let it all have to do with me!" as he hands out charity, forgives Mr. Smythe his debt and amazes the Lamplighter, Blind Old Hag and Sandwichboard Man with his generosity; he then goes out into the audience, giving out candies and treats.

Scrooge delivers the prize turkey to the Cratchits and promises to raise Bob's salary and help his struggling family. Carrying Tiny Tim on his shoulders, Scrooge goes to his nephew's house, hoping to be allowed to come to dinner. Fred and Sally sing, "Welcome home, Uncle Scrooge, welcome home to family."

It starts to snow as everyone sings a reprise of "Christmas Together," and all build a giant snowman. Tiny Tim calls out, "And God bless us, every one!" The musical ends with the song, "God Bless Us Every One." "Star by star up above, and kindness by human kindness, light this world with your love / And God bless us every one."