Synopsis

Venice Beach, California, 1980. Sonny, a chalk artist, has been working tirelessly on a drawing of the Greek muses, but when he realizes that he’s made an error, his frustration reaches a feverish pitch. Distressed, he abandons his work and rushes away -- just as the Muses from his drawing come to life. (“I’m Alive”). Clio, the youngest and loveliest of the muses, convinces her sisters to allow her to help Sonny by disguising herself as a human (by wearing roller skates, legwarmers, taking the name “Kira,” and putting on an Australian accent). Her new persona will allow Clio to inspire the struggling artist, up close.

Meanwhile, Sonny -- depressed by his failure -- has decided to kill himself. Clio/Kira arrives just in time. Gliding in on rollerskates, she tells Sonny how much she believes in him (“Magic”). Inspired by Kira, Sonny decides that he will combine all the arts by opening one amazing center for the arts to combine: a roller disco.

Clio’s eldest muse sister, Melpomene, is irritated that Clio, the youngest, has so quickly become in charge of this new artistic venture. She’s also unhappy to learn that Zeus has promised Clio the gift of “Xanadu” if Clio succeeds in her quest. Melpomene wonders if Clio has a crush on Sonny. As the muses depart, Melpomene and Calliope remain behind. It is revealed that Melpomene was passed over as leader of the muses because Zeus was afraid she’d be too busy with her daughters, the sirens (“They never call”). The pair plot to trick Clio into falling in love with Sonny, causing her to disobey Zeus’ edict that gods should not love mortals. They instruct Cupid to shoot one of his arrows at Kira, aiming for her weak spot - her Achilles heel.

Meanwhile, Sonny has found the perfect location for the roller disco: an abandoned movie theatre called the Xanadu. Sonny is concerned about finding the theatre’s owner. Clio/Kira suggests that Sonny look in the phone book (“Suddenly”). They set up a meeting with the owner, Danny Maguire, a brusque and brutal real estate mogul (and former clarinetist). Sonny meets Danny at his office and asks if he can use the Xanadu, rent-free. Danny brushes Sonny off -- he plans to tear the whole block down.

Clio/Kira appears, and Danny is struck by her resemblance to his old flame and dance partner named Kitty (“Whenever You’re Away From Me”). In a memory enacted by Clio/Kira, Kitty tells Danny that 25 years from that moment (25 years before the musical is set), he should allow Sonny to open the roller disco.

Sonny, depressed again, is back at the Xanadu. Danny arrives and tells Sonny that back in the day, he dreamed of opening a music club at the Xanadu. Although he disagrees with Sonny about the type of music that should be played at the Xanadu, Danny admits that it would be exciting to finally realize his dream of making it a music venue. He offers Sonny 25% of the profits on the condition that Sonny manages to get the Xanadu up and running in a single day (“Dancin’”). Sonny agrees.

Sonny finds Clio/Kira and tells her the good news. Clio/Kira recognizes that Sonny has struck a terrible deal, but Sonny’s enthusiasm charms her. He urges Clio/Kira to join him in sketching plans for the lobby. Meanwhile, Melpomene and Calliope decide to take this moment to curse Clio so that she’ll fall in love with Sonny (“Strange Magic”). As her designs develop, Clio/Kira brings in some of her sister muses to help the pair restore the theatre (“All Over the World”). The restoration is so successful that Danny, reunited with his clarinet and his creativity, agrees to move forward with the partnership and open the Xanadu. Sonny, thrilled, kisses Clio/Kira.

Clio is quickly overcome with guilt about her budding love for Sonny and for the joy she is experiencing in creating her own art. Both loving mortals and art-making are banned by Zeus; she is designed only to inspire, not to create. As she struggles with her feelings, Clio is visited by Hermes, who appears with a message from Zeus, reminding her of his laws. Just then, Sonny returns from putting up the sign with Danny. Clio/Kira tells Sonny that she must leave, but he urges her to stay (“Don’t Walk Away”).

Not yet satisfied with her curse, Melpomene offers Danny a large sum of money on the condition that he tears down the Xanadu to build celebrity housing. Greed overcomes Danny, and he agrees.

Meanwhile, Clio, encouraged by Melpomene and Calliope, confesses her true name and identity as a muse to Sonny. When Melpomene and Calliope explain their curse-- that Kira’s love for Sonny was caused by Cupid’s arrow, not true affection-- Clio insists that can’t be true. Sonny is entirely out of his depth, and departs in disbelief, leaving a frustrated Clio to question his love for her (“Fool”). Clio decides that she will fly with Pegasus back to Mount Olympus, and leaves Sonny behind, wallowing in misery and confusion (“The Fall”). Sonny shares this story with Danny, who encourages Sonny to forget about the girl and about the Xanadu. Suddenly, Danny and Sonny spot Clio on Pegasus in the sky -- Sonny recognizes her as Kira, and Danny recognizes her as Kitty. Sonny decides to go after Clio/Kira, while Danny rushes off to stop the impending wrecking ball (“Suspended in Time”).

On Mount Olympus, Zeus punishes Clio for disobeying his laws by banishing her from Mount Olympus. Zeus’ wives protest (“Have You Never Been Mellow”). Thetis steps forward, recalling her son Achilles’ and his heel. She realizes that Cupid’s arrow, which was aimed at Clio’s Achilles’ heel, couldn’t have pierced her thanks to the protection of her legwarmers. Clio realizes that this means her love for Sonny was real. She tears off her legwarmers and declares her love to Zeus (“I’m Free”).

Suddenly, Sonny appears on Mount Olympus. At first, he thinks that the gods are actually actors in Clash of the Titans, but Clio sets him straight. Nevertheless, Sonny informs Zeus that he will fight anyone or anything to be with Clio. Zeus is impressed and decides to allow Clio and Sonny to be together. He finally reveals what the gift of “Xanadu” actually is: “True love and the ability to create and share art." With the gift of Xanadu in tow, Clio and Sonny return to L.A. together (“Xanadu”).