Act I
Lonny the narrator sets up the story: In 1987, as an aspiring rocker named Drew Foley works as a busboy in the cool Hollywood bar/club called The Bourbon Room, owned by Dennis Dupree ("Just Like Paradise/Nothing But A Good Time"). He instantly falls for a girl, Sherrie Christian, who just arrived in town from Kansas hoping to make it big in acting ("Sister Christian"). After being hired as a waitress in the club, Sherrie urges Drew to follow his dreams ("I Wanna Rock").
German developers, Hertz and his son Franz, manage to convince the city's Mayor to abandon the "sex, drugs and rock-n-roll" lifestyle of the Sunset Strip and introduce "clean living" into the area, which angers the City Planner, Regina ("We Built This City"). When Dennis learns that part of the plan involves demolishing his club The Bourbon Room, he believes the club can generate some more money by having rock star Stacee Jaxx and his band Arsenal, who recently announced their break-up, perform their last show at The Bourbon ("Too Much Time on My Hands"). He calls Stacee and convinces him to play his band's last show in the club where he first began. Regina begins protesting Hertz and Franz's redevelopment plans ("We're Not Gonna Take It").
Later, Sherrie argues with her parents on the phone, and Drew struggles to write lyrics that mean something ("More Than Words/Heaven/To Be With You"). Drew invites Sherrie to have a picnic in the Hollywood hills overlooking LA ("Waiting For A Girl Like You"). There, he mistakenly suggests that the two are just friends to try to calm their nerves, disappointing both of them and ruining their date.
Stacee Jaxx arrives at The Bourbon to give an interview about his life ("Wanted Dead Or Alive"). Sherrie is immediately smitten with him, and believing she means nothing to Drew, has sex with Stacee in the men's room ("I Want To Know What Love Is"). Drew then plays in the club and displays enough musical ability for Dennis to ask him to open for Stacee and Arsenal.
After their tryst, Stacee tells Dennis to fire Sherrie before the gig starts. His guitarist realizes what Stacee did and knocks him out. A record producer who is at the club suggests Drew take over for Stacee, and then offers him a contract, which he gratefully accepts. Sherrie seeks comfort from Drew after she is fired, but having seen her go into the men's room with Stacee, he dismisses her ("Come On Feel The Noize"). Regina, meanwhile continues her protest ("We're Not Gonna Take It [Reprise]").
An upset and very unemployed Sherrie meets Justice, the owner of the nearby Venus Club which Justice prefers to call a 'gentlemans club' She relates to Sherrie's story, saying that many of America's small-town girls hoping to hit it big in Los Angeles end up making a living as strippers. Grudgingly, Sherrie accepts Justice's offer to work at her club ("Harden My Heart/Shadows of the Night"). As the act closes, everyone is alone - Drew, as a new recording star; Sherrie, fending for herself as an exotic dancer; Regina protesting the redevelopment and Dennis, trying to save his nightclub ("Here I Go Again").
Act Two
Hertz and Franz begin the demolition of the Sunset Strip, but this alienates themselves from each other as Franz falls for Regina and sees "the error of their ways". Dennis and Lonny then join the fight with little success ("The Final Countdown").
Drew's rocker image is upsetting the record producer, and Sherrie is learning how things really work at the Venus Club ("Any Way You Want It/I Wanna Rock [Reprise]"). When they suddenly meet on the street, Sherrie is embarrassed about what she does for a living and Drew is upset that his record company is attempting to reshape him into part of a boy band. They argue and Sherrie admits that she loved Drew, but he said they were friends. They part ways even more troubled by these new revelations ("High Enough").
Stacee goes to the Venus Club and is pleased to see Sherrie. After being forced to give him a lapdance, she beats him up while dancing ("I Hate Myself For Loving You/Heat Of The Moment"). Drew arrives to admit his feelings to her, but becomes very angry when he sees the two in a suggestive position and storms off. Justice later tells Drew that as soon as he left, Sherrie punched Stacee in the jaw.
Regina continues her big protest against the destruction of the Strip, but it unfortunately yields no success. She convinces Franz to stand up to his father if he does not believe in his father's vision. Franz admits he has his own dream, which is to open a confectioner's shop in Germany. He then rebels against his father and admits his love for Regina ("Hit Me With Your Best Shot"). Dennis and Lonny, both upset at the loss of The Bourbon Room, hilariously suggest they had feelings for each other ("Can't Fight This Feeling").
Sherrie decides to leave the Venus Club after the big scene with Drew, and Justice tells her that she had a similar experience with her first love.
Everyone is in total turmoil as they attempt move on with their lives ("Every Rose Has Its Thorn"). Franz leaves for Germany and Hertz stands on the balcony of his hotel with regret at the hurtful way he treated his son ("Keep On Lovin' You"). Regina arrives and explains to Hertz that whatever he thinks Franz doesn't hate him, he just wants his father to support his dream. Hertz then returns the deed to the Bourbon Room to Dennis and makes an investment in Franz's confectionery store.
Drew, now working as a pizza delivery boy, realizes none of his dreams have come true- he still isn't a rock star, and Sherrie is leaving on a midnight train. Lonny arrives to tell him to make his own destiny; that it's up to him to get the girl. He decides to go after Sherrie ("Oh Sherrie"). and reaches her in just in time and they realize their love has survived all their many trials and reconcile ("The Search Is Over").
Epilogue
The Bourbon Room is spared from demolition and washed-up Stacee Jaxx has now been charged with statutory rape and fled to Uruguay. Franz opens his beloved confectionery store in Germany and has a long distance relationship with Regina. Dennis dies, and Sherrie and Drew move to Glendale and start a family. Lonny notes that on The Strip, sometimes the dreams you come in with aren't necessarily the dreams you leave with, but they still rock ("Don't Stop Believin'").
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