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The fictional German town of Roulettenburg is a meeting place for people who want to take a chance at the gaming table and in life. Alexej is in love with Pauline, the General’s daughter, who employs him as a teacher. He has lost all the money he obtained from selling Pauline’s jewelry, on her behalf, at the gambling table. The General, who himself is short on cash, does not understand how he could have lost such a large amount. Alexej explains those are all his savings. Pauline is very disappointed that now she cannot pay off her debts to the Marquis. She demands that he flirt with the German baroness, whereupon the baron becomes angry and demands Alexei’s resignation if he will not apologize. The General sees his chances with the beautiful Blanche dwindling now that he no longer has any money. He expects an inheritance from his grandmother the next day, but she quickly recovers from her illness and takes a chance in the casino, where she gambles away all her money. Prince Nilsky sees his opportunity and runs off with Blanche, causing the General to collapse. Alexej decides to seek advice from experienced players, after which he wins so much that the bank cannot pay out the amount. He wants to give the money to Pauline so that she can pay off her debts to the Marquis, but she does not want to accept the money. For a moment, Alexej dreams of a life with her outside Roulettenburg. Pauline says she wants the money anyway, but the moment he gives her the money, she throws it on the ground, leaving Alexej stunned.
