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Mary Richards arrives in Minneapolis-St. Paul and her long-time friend, Phyllis, finds her an apartment. Although this leads to a conflict with the girl living upstairs, Rhoda Morgenstern, who wanted the apartment herself, the two become friends. Mary starts work at a strange new job – associate producer of a news program for a television station. Her boss is Lou Grant. The following day, Mary’s ex-boyfriend, Bill, shows up from out of town and she invites him to her apartment that night. The evening proves to be a disaster when Lou shows up intoxicated and insists upon using her typewriter to write a letter to his wife. While Lou is typing, Bill shows up, and before long it is apparent the romance between Mary and Bill will never be rekindled.

Lou happily makes the announcement to the news staff that Edie is going to march down the marriage aisle again, but not with him. Hoping to keep Lou as a friend, Edie invites her ex-husband to her wedding – which brings out all the animosity over her remarriage Lou has tried so hard to hide.

When writer Wes Callison quits his job at the station writing for Chuckles the Clown, Mary tries to help him develop a five minute humorous spot on the news show, but it fails. Wes decides to try out a comedy routine at a small nightclub and invites Mary, Lou, Murray, Ted and Rhoda. Mary and her friends do the best they can in the audience, but Wes is a flop and decides to return to writing for Chuckles.

Mary Richards’ parents are having a difficult time adjusting to their new home in the city. Mary’s father misses his old chums and Mary tries to help him make new friends. Mary takes her father to lunch with Lou Grant, but the two have nothing in common. Mary decides she will invite her father to have dinner with her so they can talk it over. A family crisis arises, however, when Mary has to tell her mother that the dinner invitation doesn’t include her.

When the apartment directly below Mary Richards’ becomes available, she spreads the word at the television news office where she works. Newsman Ted Baxter looks the apartment over, likes it and, to Mary’s chagrin, decides to move in. He is encouraged repeatedly to do so by Phyllis Lindstrom, who would like a “celebrity” living in the building. The finicky Ted brings in a law student to check the lease and newsroom boss Lou Grant tries to help Mary by pointing out to Ted all of its disadvantages. Ted is not fazed, however, until Lou reminds him of the moving expenses he will incur. As a result of this, Ted reconsiders his decision to move.

Producer of WJM-TV’s news program in name only, Mary asks Lou for the chance to actually produce the show on her own, and she gets it – along with the last minute problems and decisions that go with the job.

Murray Slaughter becomes depressed when he learns a former writing classmate has won a Pulitzer Prize in journalism while Murray is still writing one-syllable words for Ted Baxter to mispronounce. Mary Richards and Lou Grant try to talk Murray out of his depression, but he seems determined to either quit or get Lou to fire him. Then Ted Baxter pitches in and takes Murray out on one of Ted’s typical “bachelor nights on the town.”

Ted is stricken with a mild heart attack while on the air, and is taken off to the hospital. He soon recovers, but goes through a personality change reflecting his newfound attitude, which is, “It’s great to be alive and I have to enjoy and live every moment.” The WJM gang quickly become fed up with the new Ted, and long for the old days. True to his real nature, Ted quickly slides back into his pre-heart attack obnoxious self within a few weeks.