Later all the girls and fishermen are ecstatic singing 'June is Bust'in out all over' and have a great time at the 'Clam Bake'

Julie, however, is touched with sadness, knowing  that her husband has bad moods yet she loves him deeply, and for this reason there is no point in her wondering if he is good or bad ("What's the Use of Wond'rin'"). But Billy gets involved in a hold-up. Caught by the police, he commits suicide. Overwhelmed by her grief, Julie tries to find solace in the comforting words of her friend, Nettie ("You'll Never Walk Alone").

Billy arrives in Heaven, where he defiantly says that he does not regret his actions on Earth. For this he is doomed to spend fifteen years in Purgatory. At the end of that period the Starkeeper in Heaven allows him to return to Earth for a single day to gain redemption for his soul. Snatching a star, which he intends as a gift for his daughter, Billy comes back to Earth. He finds that she is an unhappy child. Through his understanding and tenderness, Billy is able to lift his daughter out of her sadness and to fill her with hope and courage while finding redemption for his soul.