Bob Wiley is a good-natured man with great work ethic, but he suffers from multiple phobias and is divorced because his ex-wife likes the singer Neil Diamond. While he regularly attends therapy, he makes little progress and his neuroses compel him to seek reassurance at all times from his therapists, much to their chagrin. Exhausted from Bob's high-maintenance conditions and invasions of personal boundaries, his current therapist refers him to a colleague, Dr. Leo Marvin. Leo, a moderately successful but egotistical therapist in his own right, believes that he is about to become famous as he has published a book, Baby Steps, his personal therapy method that he hopes will become a national trend and propel him into a household name. Bob, upon meeting with Dr. Marvin, feels good about the results of an initial session, but Marvin dismisses Bob in a rush to take a long-standing family vacation to Lake Winnipesaukee, New Hampshire for a month. Unable to cope, Bob follows Leo to his vacation home. Leo is annoyed because he doesn't see patients on vacation, but seeing how desperate Bob is, he tells him to "take a vacation" from his problems. Bob seems to have made a breakthrough, but the next morning, he tells Leo that he decided to take a vacation in spirit and fact at Lake Winnipesaukee as a guest of the Guttmans, a couple who own a coffee shop and happily welcome Bob as their guest. The couple encourages Bob to be around Leo, as they hold a grudge against Dr. Marvin for purchasing the lakeside home they had been saving for years to buy.
Bob suggests that they start a friendship, but Leo thinks being friends with a patient is beneath him and attempts to avoid any further contact, as Bob's very presence ruins his ideas of a peaceful, non-working vacation. However, Bob swiftly ingratiates himself with Leo's family, who think Bob may have some foibles but is otherwise a balanced and sociable man. Leo's Kids, Anna and Sigmund, find that Bob relates well to their problems, in contrast with their father's clinical approach. Bob gains an enjoyment of life from his association with them; he goes sailing with Anna and helps Sigmund to dive into the lake, which Leo was unable to help him with. Leo then angrily pushes Bob into the lake, and Leo's wife, Fay, insists on inviting Bob to dinner to apologize to him and the kids. Bob, who believes Leo's slights against him are accidental and/or part of his therapy, accepts the invitation. After dinner, a thunderstorm forces Bob to spend the night. Leo wants Bob out of the house early the next morning before Good Morning America arrives to interview him about Baby Steps. The TV crew arrives early and, oblivious to Leo's discomfort, suggest having Bob on the show as well to show the effectiveness of the book. Leo makes a fool out of himself during the interview while Bob is relaxed and speaks glowingly of Leo and the book, unintentionally stealing the spotlight.
Outraged, Leo throws a tantrum and then attempts to have Bob committed, but Bob is soon released after befriending the staff of the institution and telling them therapy jokes, easily demonstrating his sanity and, ironically showing that he has made real therapeutic progress due to his time with Dr. Marvin's family and unintentional "treatment". Forced to retrieve him, Leo then abandons Bob in the middle of nowhere, but Bob quickly gets a ride back to Leo's house while various mishaps delay Leo until nightfall. Leo is then surprised by the birthday party that Fay has been secretly planning for him and he is delighted to see his beloved sister Lily. When Bob appears and puts his arm around Lily, Leo becomes completely psychotic and attacks him. Bob remains oblivious to Leo's hostility until Fay explains that Leo has a grudge against Him, who then agrees to leave. Meanwhile, Leo breaks into a general store, stealing a shotgun and 20 pounds of explosives. He then kidnaps Bob at gunpoint and leads him deep into the woods, ties him up and straps the explosives onto him, calling it "death therapy". Leo then returns to the house, gleefully preparing his cover story. Believing the explosives to be props and used as a metaphor for his problems, Bob applies Leo's "Baby Steps" approach and manages to free himself both of his physical restraints and his remaining fears; he reunites with the Marvins and praises Leo for curing him with "death therapy". The Marvins' vacation home detonates after Bob reveals that he left the explosives inside. Leo is so horrified by the sight of this that he is rendered catatonic and his license is revoked for trying to murder a patient.
Some time later, the still-catatonic Leo is brought to Bob and Lily's wedding. Upon their pronouncement as husband and wife, Leo regains his senses and screams, "No!", but the sentiment is lost in the family's excitement at his recovery. Text at the end reveals that Bob went back to school and became a psychologist, then wrote a best-selling book titled Death Therapy and that Leo is suing him for the rights.
- Bill Murray as Bob Wiley
- Richard Dreyfuss as Dr. Leo Marvin
- Julie Hagerty as Fay Marvin
- Charlie Korsmo as Sigmund Marvin
- Kathryn Erbe as Anna Marvin
- Tom Aldredge as Mr. Guttman
- Susan Willis as Mrs. Guttman
- Roger Bowen as Phil
- Fran Brill as Lily Marvin
- Brian Reddy as Carswell Fensterwald, M.D.
- Doris Belack as Dr. Catherine Tomsky
- Melinda Mullins as Marie Grady, Good Morning America Interviewer
- Marcella Lowery as Betty, Switchboard Operator
- Margot Welch as Gwen, Switchboard Operator
- Barbara Andres as Claire, Dr. Marvin's Secretary
- Aida Turturro as Prostitute
- Stuart Rudin as Crazy Man in New York Street
- Cortez Nance Jr. as Lobby Doorman
- Lori Tan Chinn as Bus Driver
- Dennis Scott as Motorcycle Cop (as Dennis R. Scott)
- Charles Thomas Baxter as Nursing Home Guard
- Donald J. Lee Jr. as Nursing Home Attendant
- Reg E. Cathey as Howie Catrell, Good Morning America Director
- Tom Stechschulte as Lennie Burns, Good Morning America Producer
- Russell Bobbitt as Good Morning America Crew Member
- Richard Fancy as Minister
- Joan Lunden as Herself
- April Cantor (uncredited)
The film was a financial success. It grossed $63 million domestically during its original theatrical run plus an additional $29 million in video rentals and sales bringing its overall domestic gross to $92 million. Critical reaction was also favorable. It currently holds an 82% on Rotten Tomatoes with a majority of critics giving it positive reviews. When the television program Siskel and Ebert reviewed it, Roger Ebert gave it a "thumbs up" rating praising the different performances of Bill Murray and Richard Dreyfuss onscreen together as well as most of its humor. He said it was Bill Murray's best one since Ghostbusters in 1984. Gene Siskel, on the other hand, was not a fan of it and gave it a "thumbs down." He felt Murray gave a very funny and enjoyable performance in it but was rather upset by the Dreyfuss character and his angry and arrogant behaviors. He felt it would have been funnier if Dreyfuss had not given such an angry performance in it and said that Dreyfuss ultimately ruined it for him. Leonard Maltin also gave it a favorable review: in Leonard Maltin's Movie and Video Guide he gives it three stars out of a possible four, saying it's "a very funny outing with Murray and Dreyfuss approaching the relationship of the road runner and the coyote." Maltin faulted it only for its ending, which he found very abrupt and silly. In the years since its release it has become a cult classic among fans, and has been shown in some psychology classes in schools and colleges across America.
- The film was filmed in and around the town of Moneta, Virginia located on Smith Mountain Lake. Production had to go south because at the real Lake Winnipesaukee in New Hampshire, the leaves were already turning for the fall season. While there is a lake in New Hampshire named Winnipesaukee, there is no town by that name (as the film implies). This generated chuckles in lake area movie cinemas where the film was shown. Filming lasted from August 27- November 21 1990.
- The house used in the filming still stands. The exploding house was a prop one built for the explosion on a nearby lake front lot; the local inhabitants gathered to watch the explosion from land and boats.
- The scenes of Bob arriving in town on the bus with his goldfish were filmed in downtown Moneta, which was spruced up and repainted for the movie.
- The local institute which Leo tries to commit Bob in is actually the local Elks Home for retirees in the nearby town of Bedford, Virginia.
- Originally director Frank Oz had Woody Allen in mind for the role of Dr. Leo Marvin, given his reputation for quirkiness in his films. He declined the role, and Richard Dreyfuss ultimately was cast.
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