Mrs. Laura Henderson, portrayed by Judi Dench, has recently become a widow. After attending her husband's funeral, her friend Lady Conway (Thelma Barlow) suggests various activities to lift her spirits, such as finding a lover or supporting a home for single mothers. Unfortunately, none of these endeavors resonate with Mrs. Henderson.
One day, she requests her chauffeur to take her on a ride through London. Following a visit to her only son's gravesite in a British Army cemetery in France, she makes an impulsive decision to purchase a derelict theater. She enlists the assistance of English stage director Vivian Van Damm, portrayed by Bob Hoskins. Initially frustrated by her tardiness and rudeness, Van Damm is ready to walk away, but Mrs. Henderson's determination persuades him to stay.
As they embark on remodeling the theater, tensions arise between the financier and director concerning various aspects like the name of the girl chorus and the type of shows to present. They ultimately agree on producing a vaudeville farce featuring the popular actor Bertie (Will Young). Their show gains initial success; however, as other theaters quickly follow suit, their finances begin to dwindle. Mrs. Henderson then proposes a bold concept inspired by the Moulin Rouge: a nude revue.
In search of the perfect leading ladies, they scour the country without success. After a series of frustrating auditions, they return home to a disheartening reality. However, amid chaos, Van Damm and Bertie rescue a motorcycle girl from a river, and it becomes clear that they have found their star—a country girl eager for a change after helping her father in his chemist’s shop.
They commence rehearsals without the Lord Chamberlain's permission, fully aware that they may never receive it. Mrs. Henderson, recalling her acquaintance with Lord Cromer, played by Christopher Guest, attempts to leverage their past relationship. Although initially hesitant, Lord Cromer promises to make a decision regarding the permit after the premiere and sternly reminds them that "nude girls must not move, as if they were paintings in a museum."
As rehearsals progress, tensions rise among the chorus girls—Frances (Rosalind Halstead), Vera (Sarah Solemani), and Peggy (Natalia Tena)—as they become uncomfortable with the nudity. Director Van Damm tries to console them, but it's ultimately Bertie who devises a solution by suggesting that the male participants should also disrobe. This unexpected twist leads to a comical discovery when Mrs. Henderson and Van Damm's secretary stumble upon the scene, leaving them utterly baffled.
On the night of the premiere, everything appears to be going smoothly, and even Lord Cromer approaches the girls, noticeably flustered, and signs the required permit. However, a significant confrontation arises between Mrs. Henderson and Van Damm, as she becomes aware of his marriage and realizes her feelings for him. He makes it clear that her disrespect towards his wife will not be tolerated and threatens to abandon both her and the theater if it happens again.
As time passes, World War II breaks out, and the Windmill Theater becomes a sanctuary of entertainment during the Blitz, remaining open while other venues close. Soldiers frequent the establishment, and amidst the chaos, the girls find fleeting romance. One girl, Maureen, however, expresses her desire to remain single. Mrs. Henderson nudges her towards a shy soldier, and after the soldier is deployed, Maureen learns she is expecting, causing her distress.
Tragically, a bombing during an air raid takes Maureen's life, leading to a bitter rift between Van Damm and Mrs. Henderson. With the war intensifying, Lady Conway suggests that Mrs. Henderson sneak back into the theater. Although tensions linger, the show continues, and a pivotal moment arrives when the Lord Chamberlain contemplates closing the theater for safety reasons. Mrs. Henderson, using her platform, speaks boldly about her son's death, recalling a hidden French vignette featuring a nude girl in his bedroom.
As alarms sound once more, everyone—including Lord Cromer—rushes to the safety of the theater. The performances evolve, addressing patriotic themes and gaining political resonance. Eventually, Mrs. Henderson and Van Damm dance atop the theater roof—an act he had previously warned her against. In a final act of rebellion, the nude girls begin to move, defying the Lord Chamberlain's strict orders.
