Founded originally to help Rosewater descendants avoid paying taxes on the family estate by Eliot's father, a senator in Rosewater County, Indiana, the Rosewater Foundation is operated by a large legal firm in New York and provides an annual pension of $3 million to Eliot. Eliot had been seen as restless early on trying all the typical things that philanthropists do to help the poor, but he eventually sets out across America, going from small town to small town before landing in the city of Rosewater, Indiana and setting up shop. He calls Rosewater home after becoming a volunteer firefighter in numerous cities across the U.S. This fact, along with his drunkenness, his generous relationship with the poor in Rosewater, and his odd relationship with his French wife make him appear a bit crazy. A conniving lawyer by the name of Mushari has set out to prove him insane so he can collect a portion of the Rosewater fortune for himself during the transfer of it to the unwitting distant cousins in Rhode Island.
The novel is told mostly through a collection of short stories dealing with Eliot's interactions with the citizens of Rosewater County, usually with the last sentence serving as a punch line. The antagonist's tale - Mushari's - is told in a similar short essay fashion. These stories usually reveal different hypocrisies of mankind in a very dark and humorous fashion.
The novel was adapted into a musical in 1979. It marked the first collaboration of composer Alan Menken and lyricist Howard Ashman.