The story centers on Tevye, a milkman in the village of Anatevka, who attempts to maintain his Jewish religious and cultural traditions as outside influences encroach upon his family's lives.

Tevye has five daughters to support on a milkman's salary: Tzeitel, Hodel, Chava, Shprintze, and Bielka.

In "Tradition", Tevye explains the roles of each family member (fathers, mothers, sons, and daughters) in the village of Anatevka, and how the traditional roles of people like the matchmaker, the beggar, and the rabbi contribute to the village.

Who must know the way to make a proper home?
A quiet home, a kosher home
Who must raise a family and run the home
So papa's free to read the holy book?
The mama, the mama ... tradition.

Yente, the village matchmaker, wants to pair Tzeitel with Lazar Wolf, a wealthy butcher and widower older than Tevye, but Tzeitel is already in love with her childhood friend, Motel the tailor.

Motel is very poor and is saving up to buy a sewing machine before he approaches Tevye, to show that he can support a wife.

As the villagers discuss news from the outside world of pogroms and expulsions, a stranger named Perchik scolds them for doing nothing more than talk. The others dismiss Perchik as a radical, but Tevye invites him home for the Sabbath meal and offers him room and board in exchange for tutoring his two youngest daughters.

Tevye meets Lazar for a drink, assuming mistakenly that Lazar wants to buy his cow. Once the misunderstanding is cleared up, Tevye agrees to let Lazar marry Tzeitel. With a rich butcher for a husband, his daughter will never go hungry.

Tzeitel and Motel plead with Tevye to rethink her marriage to Lazar Wolf, and to consider Motel instead. Tevye eventually agrees but how to break this news to Golde? He pretends to wake from a nightmare in which Golde's grandmother Tzeitel returns from the grave to bless the marriage of her namesake, but to Motel, not to Lazar Wolf. Lazar's formidable late wife, Fruma-Sarah, also rises from her grave to warn, in graphic terms, of severe retribution if Tzeitel marries Lazar. The superstitious Golde is terrified and quickly counsels that Tzeitel must marry Motel.

"Wonder of wonders, miracle of miracles
God took the tailor by the hand
Turned him around and miracle of miracles
Led him to the promised land"