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While waiting to hear from her boyfriend Peter Brent, who is currently away at agricultural college, Tambrey 'Tammy' Tyree (Sandra Dee) moves her shantyboat, the Ellen B down the river so that she can attend Seminola College and get some learnin' for herself. On her first day there, she meets her public speaking instructor Tom Freeman (John Gavin) who is enchanted by Tammy's archaic speech and recommends her for a job as a companion to crusty old Annie Call (Beulah Bondi), wealthy donor to the college. In an attempt to be free of her meddling, money-hungry niece Suzanne (Julia Meade), Annie decides to move onto the Ellen B with Tammy.

Tammy Tell Me True is the second of four movies based on the 1948 novel Tammy Out of Time by American novelist Cid Ricketts Sumner. The novel was adapted for the film by American screenwriter Oscar Brodney. Tammy Tell Me True was preceded by Tammy and the Bachelor (1957) (1957) and followed by Tammy and the Doctor (1963) (1963) and Tammy and the Millionaire (1967) (1967).

Hoping to gain control of Annie's money, Suzanne seeks to have her declared incompetent and confined to an institution or to her home in the care of proper attendants. At Annie's competency trial, Suzanne and her lawyer build a strong case, bringing in various witnesses to attest to Annie's sometimes irrational behaviors and suggesting that Tammy took advantage of her condition. When it's Tammy's turn to take the witness stand and attest to Annie's sanity, she cannot find the words until Tom is allowed to question her instead of her lawyer. With Tom at her side, Tammy is able to describe how Annie 'came to life on the river and got her soul back'. At the end of the trial, the judge finds Annie to be of 'sound mind.' After the trial, Tammy tells Tom that Annie helped her to realize that she never really loved Pete in that 'forever after' kind of love. In the final scene, Tom gives back the necklace that Annie gave Tammy. When he tries to place it around her neck, it inadvertently slips and falls into her cleavage but does not fall to the floor as it did when she earlier placed Annie's key in the same place. Tammy leaps into Tom's arms and declares, 'I AM a woman fully growed!'