As a young girl, Mary holds a deep crush on George. However, a slight difference in their ages, combined with George's denseness about her feelings, put her more in the sights of George's pal, Sam Wainwright, for many years. Mary and George meet up again at the high school dance, held for the graduating class of George's brother, Harry. They become reacquainted and discuss their respective plans for the future until the night is interrupted by the sad news of the illness and eventual passing of George's father.
Four years later, George is taking a walk, frustrated by yet another turn of events that kept him in town and seemingly tied to the Bailey Building and Loan. He happens to come by Mary at her mother's house, where his feelings for her that he had denied for so long are finally realized. They are soon married afterward, despite some mild fretting on the part of Mary's mother. However, their honeymoon is cancelled by a Depression-era bank panic which affects the Building and Loan. Mary offers the money saved for their honeymoon to keep the Building and Loan solvent. Later, as they started a growing family, money is always tight, and they have to make do as best they could.
On Christmas Eve, Mary fears the worst when a distraught George becomes frustrated about Uncle Billy losing an $8,000 deposit. George is only turned away from suicide by Clarence Oddbody, an angel sent at the behest of the prayers of Mary and the whole town of Bedford Falls. George is then shown a world where he was never born; among the things seen in this nightmarish world is a lonely, spinster Mary who had never been a dreamer, let alone married one. After George is returned to the life he knew and now cherishes more than ever, his and Mary's efforts on behalf of the townsfolk are repaid with more than enough donations to save the Building and Loan.