Manuela von Meinhardis, in the care of an unfeeling aunt after her mother dies, is sent to a boarding school at Potsdam in 1910. The school is run under rigid Prussian discipline by the authoritarian headmistress. The only sympathetic teacher is Miss von Bernburg, who disagrees with the militaristic regime at the school and encourages the girls' self-expression through the arts. All of Manuela's affection is poured out on the attractive Miss von Bernburg, who says that she belongs to all the girls and cannot have favourites.
For the annual play, performed before parents and the princess who is patron of the school, Romeo and Juliet is chosen and the previously shy Manuela emerges as a forceful Romeo. Unfortunately, the cook puts rum in the punch served to the girls at the party after the play, where a drunken Manuela publicly proclaims her love for Miss von Bernburg. Telling Miss von Bernburg she must resign, the headmistress confines Manuela to the sanatorium. When Manuela learns that Miss von Bernburg is leaving, she threatens to throw herself down the staircase in front of the whole school. After Miss von Bernburg begs her not to jump, she is seized by other girls and, in a state of collapse, taken back to the sanatorium. There the headmistress visits her and, in an unprecedented show of humanity, holds her hand while at the same time asking Miss von Bernburg to stay.
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