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Robert Altman based the story of Three Women on a dream he had,
and the film, the central theme of which is psychological dependency, retains certain elements of dreamlike elusiveness.

The setting is the desert: a Palm Springs spa for old people, where Millie (Shelley Duvall) and her roommate-disciple-admirer, the younger Pinky (Sissy Spacek), work as physiotherapists. Millie, a willing prisoner of the consumer culture, covers her frustrations and unhappiness by the creation of a persona based on models culled from the smart set magazines, and by the absorption of all the useful hints offered by ladies' magazines. Her self-deception is so successful that she believes she is liked by all, while in reality no one except the adoring Pinky can stand her. Pinky, a drifter from the back-woods of Texas, glows in her hero worship; having a home with Millie is better than having no home at all.

The two girls room in an apartment house owned by an ex-stuntman, Edgar, whose wife paints strange murals, while Edgar also owns a rundown roadhouse, where they drink. The married couple acts as a catalyst on the relationship of the girls: the ageing philandering stuntman has slept with both girls, while the lonely, introverted Willie draws the two girls closer to her. When Pinky aimost dies after an accident, her relationship with Millie undergoes a marked change.

Finally, the women dispose of Edgar, and form a grandmother-mother-daughter relationship that seems both mad and strangely serene.