We were now in front of Tiffanys. Jeff. the writer, has Lula Mae, a fictional character from one of ha stories, in tow. She hasn't been working out. Jeff has a stack of rejection slips to prove it and intends to work her character over starting right from the top, with her name. From now on. she'll be Holly.
Jeff's new character "dates" for a living: the odd fifty dollar tip for the ladies' room to keep the wolf from the door, and dreams of having breakfast at Tiffany's. The men in her life may find this new Holly hard bitten, but Jeff is thrilled with her new bite and possibilities. Working out those possibilities in his mind, Jeff decides she trained herself to like older men for the security they provided. The one soft spot in her heart is reserved for her little brother Freddy from the days when she was still Lula Mae. In Holly's new story. however, she still sees safety in numbers and an apartment full of suitors, each expecting to have had a private date with Holly. Into this melange sweeps Holly's sometime friend, oft times rival,. Mag Wildwood. Mag manages to collapse and spend the night instead of any of the men. In the morning, both fairly well hung over, Holly and Mag speculate that there will always be a place for them at the wayward girls hostel.
Jeff finds his creation is getting out of control. She reminds him that he created her as someone ephemeral. Jeff is in a quandary: he is fascinated but troubled by his creation. He wonders if he ought to move on. As if to answer his question, a remnant of Lula Mae's past appears: Doc Golightly. Holly's abandoned husband from Tulip, Texas. He still needs her, and wants her back. Doc tells Jeff he couldn't understand because - he's never kissed her. Holly will have none of it. Jeff is desperate to get some control back over his creation. To Holly's horror, he reveals that her brother Freddy has been killed in the army as he brings the first act to a close.
Act II opens back in Harry's Bar where Jeff is trying to rid himself of writer's block. The "cure" just brings his fictional Holly into the bar . Holly the exits with the other "men" leaving Jeff alone.
At the townhouse of Rusty, one of Holly's steady dates that friend Mag has run off with (and is about to marry), Holly meets Carlos Ybarra Jaeger, a wealthy Brazilian. The attraction is definite and mutual. And Carlos asks her to stay with him.
Jeff confronts Holly. She is happy and in love. He isn't sure. Can it be he's jealous of his creation? Holly assures him that he — Carlos or Jeff — has changed her for good. Jeff argues that Holly can't marry Carlos since she's already married to Doc. She refuses to take any notice of it. She and Carlos are in love, and they vow to each other.
Fate, or a writer with a story to tell throws another spanner in the works. Two Federal marshalls burst in and arrest Holly on a drugs charge. It seems those trips upstate for "Uncle Sally' that Holly is still making allowed Sally Tomato to run his narcotics business from prison by sending coded messages back to New York with the unsuspecting Holly.
Holly is thrown in jail with three prostitutes who urge her to turn state's evidence. But Holly cares for Sally and won't, even with her whole world collapsing. In the struggle when being arrested she lost Carlos' child she was carrying. In the five days she's been in jail no one has come to see her. Meanwhile the hookers' pimp boyfriend is there, wishing them an affectionate goodbye and not lifting Holly's spirits at all.
Jeff is appalled. He doesn't like where he has taken his character and wants to start all over again, but Holly says she is what she is. Both admit loving the other but realising that from where they stand. The other isn't really real. Jett asks Holly what he can do, and she asks him to feed her cat. She'll be fine; she's just lonely and scared and longing for breakfast at Tiffany's.
Back in the bar, the bartender is asking Jeff how the story came out. Jeff says "just as you'd expect… when a all starts moving by itself: He saw Carlos when he went to feed Holly's cat, and begged him to stand by her but Carlos said the scandal would be too much for his family and leaves but not before paying Holly's bail.
Holly returns, and unrepentant, vows that she's is going to make the same mistakes all over again. Ignoring her bail, she's off to Europe to see Mag and Rusty. She sets the cat free but Jeff asks if he can keep it. This is fine by her: she's off and travelling again, leaving Jeff in the bar contemplating the African curio that bears the strange resemblance to the character he's not sure he imagined or not.