In 1912, the protagonist, Horty, leads an uneventful life as a foundry worker in the Lorraine region of northern France with his wife, Zoe, "the most beautiful woman in town." The owner of the foundry where Horty works, Simeon, lusts after Zoe. When Horty wins a company athletic contest, Simeon's prize is a ticket to Southampton to see the sailing of the Titanic.
The night before the Titanic departs, Horty meets a beautiful young woman named Marie, who explains that she is a chambermaid aboard the Titanic. Marie has nowhere to sleep because all of the local hotels are full, and Horty agrees to share his room. Their encounter is seemingly chaste, with Marie sleeping in the bed while Horty spends the night in the armchair. However, in the middle of the night Marie tries to seduce him. Whether or not she succeeds is ambiguous, and she is gone when Horty awakes. Attending the departure of the Titanic, Horty spots a photographer taking a picture of Marie, and asks the photographer for the photo.
Upon returning home, Horty finds that he has been promoted, but this good news is dampened by rumors of an affair between his wife, Zoe, and the foundry owner, Simeon. A bitter and jealous Horty visits a local bar to drown his sorrows. Drunk, he tells friends and co-workers about the lovely chambermaid he met in Southampton, earning him free drinks and tips. Following the sinking of the Titanic, Horty's tales become increasingly erotic, and the viewer is never sure what is truth and what is fantasy.
Horty catches the attention of a traveling entertainer named Zeppe. Zeppe offers Horty the chance to escape his dismal dreary life. Horty agrees and begins to work with Zeppe, converting his story into a play. One night, Zoe attends the play; later, Horty explains his tale as a work of fiction. However, Horty's story becomes more elaborate and romantic attracting a larger audience for each re-telling steadily driving a wedge between him and his wife. Eventually Zoe demands a part in the performance, playing the role of Marie poignantly fighting against the waves after the Titanic sinks. The film ends by revealing why Marie would sleep with Horty.