In front of a tobacco factory, Moralès and the soldiers of the guard watch the passers-by. Micaëla, a girl from the countryside, asks Moralès if he knows José, and is told that he is expected shortly. Avoiding the soldiers' invitation to stay with them, Micaëla escapes. As the guards are changed, Moralès tells José that a girl is looking for him.
The factory bell rings and the men gather round the female workers as they return after their lunch break. Carmen is awaited with anticipation. She tells the men that love obeys no laws. Only one man pays no attention to her - José. Carmen throws a flower at him. The women go back into the factory and the crowd disperses.
Micaëla returns. She gives José a letter from his mother. When he starts to read it, Micaëla runs off in embarrassment, because it suggests that he marry her.
A fight is heard from within the factory. The girls stream out. Carmen and one of her fellow workers quarreled and the other girl was wounded. Carmen refuses to answer any questions about what happened. Zuniga, José's superior, orders him to tie Carmen up and take her to prison. But Carmen convinces José to let her escape. He unties the rope and, as they leave for prison, Carmen slips away. José is arrested.
ACT II
Carmen and her friends Frasquita and Mercédès entertain Zuniga and other officers in Lilias Pastia's tavern. Zuniga tells Carmen that José has been released this very day. The boxer Escamillo enters, cheered by the crowd. He describes the excitements of his profession, including the amorous rewards that follow a successful fight.
When the company has departed, the smugglers Dancaïre and Remendado tell the girls that they are needed as accomplices. Frasquita and Mercédès are game, but Carmen refuses to leave. She is in love. Her friends are incredulous.
José is heard in the distance. The smugglers withdraw. Carmen dances for José, but when bugles are heard sounding the retreat, José says that he must return to barracks. Carmen mocks him. He shows her the flower she threw and confesses how its faded scent sustained his love during the long weeks in prison. She replies that he doesn't love her. If he did, he would desert and join her in a life of freedom. When he refuses, she dismisses him contemptuously.
Zuniga bursts in. In jealous rage José attacks him. The smugglers return, disarm both of them, and put Zuniga under constraint. José now has no choice but to desert and join the smugglers.
ACT III
At night, the gang gathers at a notorious hangout for crooks, while Dancaïre and Remendado go on a reconnaissance mission. Carmen and José quarrel. The women read the cards: Frasquita and Mercédès foresee rich lovers, but Carmen's cards spell death, for her and for José.
Remendado and Dancaïre return announcing that police are paroling the area. Carmen, Frasquita, and Mercédès know how to deal with them. All depart.
Micaëla appears. She reflects on her fears to meet the woman who has turned the man she once loved into a criminal. She hides when a shot rings out. It is José firing at Escamillo. He provokes José, and the men start to fight. Carmen and the smugglers return and separate them. Before he leaves, Escamillo invites everyone to be his guests at his next fight.
Micaëla is discovered. She begs José to go with her to his mother, but he furiously refuses. Only when Micaëla reveals that his mother is dying does he agree. José promises Carmen that they will meet again.
ACT IV
Among the excited crowd cheering the parade of fighters are Frasquita and Mercédès. They warn Carmen, who is now together with Escamillo, that José has been seen in the crowd. She says that she is not afraid.
José enters. He implores her to forget the past and start a new life with him. She tells him calmly that everything between them is over. She will never give in. She was born free and free she will die. While the crowd is heard cheering Escamillo, José tries to prevent Carmen from joining her new lover. Carmen furiously takes from her finger the ring that José once gave her, and throws it at his feet. José stabs her.
