François Pignon, an unassuming divorced man with a teenage son who ignores him, lives a quiet and unremarkable life. When he learns he will be fired from his job as an accountant in a rubber factory, he contemplates suicide, but his new neighbor Jean-Pierre Belone, a former industrial psychologist, dissuades him from jumping from his balcony and suggests a way to keep his position. Belone proposes that Pignon start a rumor he is homosexual by inserting his image in sexually provocative snapshots of a gay couple in a bar and anonymously mailing them to his boss, Mr. Kopel. The factory's primary product is condoms, so the gay community's support is essential, and Kopel will have to keep Pignon on the payroll to avoid charges of anti-homosexual bigotry. Pignon does not change his usual mild and self-effacing behavior and mannerisms in any way as part of his masquerade. But his supervisors and co-workers begin to regard him in a new light, seeing him as exotic rather than dull, and his life becomes unexpectedly and dramatically better. Félix Santini, a homophobic co-worker who used to harass him, is warned he could be fired for discrimination if he continues to belittle Pignon, so he begins to make friendly overtures. The company enters a float in a local gay pride parade, and Pignon is coerced into riding on it; his estranged son sees him in the televised broadcast of the parade and tells his mother. The son is thrilled to learn his father, whom he has always considered bland and boring, has a wilder side, and expresses an interest in spending more time with him. His suspicious ex-wife invites Pignon to dinner and demands an explanation. He has by this point gained enough self-confidence to tell her exactly what he thinks of her. Meanwhile, Santini's charade of friendship has developed into an obsessive attraction; his wife suspects him of having an affair when she finds a receipt for an expensive pink cashmere sweater, and leaves him when he buys Pignon chocolates. After this, Santini invites Pignon to move in with him. When Pignon turns him down, Santini snaps, a fight ensues, and Santini is institutionalized to recover from his emotional breakdown. Eventually, Pignon's ruse is discovered when Kopel catches him making love inthe office to his co-worker, Mlle Bertrand. However, he has become so assertive that he keeps his job, relates to his son, patches up his relationship with Santini, cheers up Belone, and lives happily ever after.
Stephen Holden of the New York Times called it "giddy social comedy" and "a classic French farce" and added, "What's so liberating about The Closet is its refusal to walk onpolitically correct eggshells. The target of its blunt lusty humor is as much exaggerated political correctness and the panic it can engender as it is bigotry." Roger Ebert of the Chicago Sun-Times said, "The movie passes the time pleasantly and has a few good laughs... But the screenplay relies too much on the first level of its premise and doesn't push into unexpected places. Once we get the setup, we can more or less anticipate the sitcom payoff, and there aren't the kinds of surprises, reversals and explosions of slapstick that made La Cage Aux Folles so funny. In the rating system of the Michelin Guide, it's worth a look, but not a detour or a journey." Peter Travers of Rolling Stone called the film "a bonbon spiked with mirth and malice" and noted, "Auteuil and Depardieu spar hilariously, and writer-director Francis Veber, following The Dinner Game, offers another delicious treat." Lisa Schwarzbaum of Entertainment Weekly rated the film A-, calling it a "cagey, high gloss comedy" and a "perfectly built French tickler."
