In 1964, Guy Patterson is a drummer and jazz fan who works at his family’s Erie, Pennsylvania appliance store. Rhythm guitarist/singer Jimmy Mattingly and lead guitarist/singer Lenny Haise ask Guy to substitute at the annual Mercyhurst College talent show for their group’s injured regular drummer. The group, including the bass player play a ballad written by Jimmy and Lenny titled “That Thing You Do“. Jimmy’s girlfriend Faye Dolan suggests for the group the name “The Oneders”; it is pronounced “ONE-ders”, but it is almost always mispronounced as the “oh-NEE-ders.”
At the talent show, Guy unexpectedly sets up a fast, pounding beat rhythm to the originally slow-paced love song and it excites the crowd. The Oneders win the $100 top prize, obtain their first paying gig at a pizza parlor, and begin selling a single of “That Thing You Do”, which receives local radio airplay and earns them bookings in nearby cities. After being herded by a local manager, their act becomes hotter and, at a Pittsburgh gig, a record company A&R representative Mr. White signs the band to Play-Tone Records, renaming the group The Wonders.
The Wonders and “costume mistress” Faye tour state fairs across the Midwest during the summer with other Play-Tone artists, during which Guy and Faye grow closer. “That Thing You Do” enters and climbs the Billboard Top 100. The Wonders go from being the opening act to the feature attraction, and throngs of teenage girls mob the band, but the bass player still plans to enlist in the United States Marine Corps at the end of the summer. When “That Thing You Do” hits the Top 10, Play-Tone sends the band to Hollywood to meet Sol Siler, the label’s owner. Siler and White promise The Wonders that they will appear in a major motion picture and have a recording session for an album.
The Wonders appear as “Cap’n Geech and the Shrimp Shack Shooters” in the low-budget beach movie Weekend at Party Pier; this and Siler’s other actions disillusion Jimmy. The bass player leaves the group to join Marines he met at their hotel and never returns. Guy meets his idol, jazz pianist Del Paxton, at a jazz club. An experienced studio bassist joins The Wonders for a live performance on The Hollywood Television Showcase. During the nationally televised prime-time variety show, the words “Careful girls, he’s engaged!” are captioned on the screen beneath Jimmy’s image (an homage to the caption “Sorry girls, he’s married!” for John Lennon on The Ed Sullivan Show). An angry Jimmy tells Faye and the others that he does not intend to marry her, ending their relationship.
At the recording session, The Wonders learn that they are to record songs from the Play-Tone catalog for their album. White promises Jimmy one original song per side of the album but demands “snappy” material, not ballads, causing Jimmy to quit the band. Lenny never shows up for the session, having driven to Las Vegas to elope with a Play-Tone secretary/former Playboy Bunny after the televised show. White declares the group in breach of contract and advises Guy, now the only band member in the studio, to pursue Faye. Del Paxton, who is recording next door, hears Guy’s drumming and the two record a jam session. Guy tells Faye that Del thinks he has potential as a studio musician, and the two declare their love for each other.
In a written epilogue, Guy and Faye marry the following year and raise four children in Bainbridge Island, Washington, where they start a music conservatory and Guy teaches jazz composition. Jimmy rejoins Play-Tone, records three gold albums with a new band, The Heardsmen (a name he originally suggested for the Wonders) and becomes a music producer in Los Angeles. Lenny manages a casino in Laughlin, Nevada and is “currently single”. The bass player is awarded the Purple Heart for wounds sustained at Khe Sanh while serving in the Marines, and becomes a building contractor in Orlando, Florida.