The character is a building and loan banker who sacrifices his dreams in order to help his community of Bedford Falls to the point where he feels life has passed him by.

Eventually, due to difficulties in keeping the building and loan solvent, Bailey falls into despair so deep that he contemplates suicide, until a guardian angel, Clarence Odbody, gives him a valuable perspective on the worth of his life.

George finds through Odbody's angelic power and gift what the lives of his family and friends and the social structure of Bedford Falls would be like without him.

Bailey is played by James Stewart as an adult and Bobby Anderson as a child, and is loosely based on George Pratt, a character in Philip Van Doren Stern's 1943 booklet The Greatest Gift.

[2] In the winter of 1919, George (aged 12, played by Bobby Anderson) and his friends Bert, Ernie Bishop, Marty Hatch, Sam Wainwright, and his brother Harry are sledding on a frozen river.

In May 1920, George returns to his after school job at Mr. Gower's drugstore, where he first attends to the soda fountain when two customers are Marty’s sister Mary and her friend Violet Bick.

Before going George talks with his father about his plans for the future, in which architecture has replaced exploring, but he still desires to leave Bedford Falls and see the world.

Peter Bailey explains that the work they have done in the building & loan is a way to make their mark on the world, but endorses George's decision to leave town "if he is unwilling to crawl to Potter".

Three months later August, George is in a meeting with the board of directors of the Building & Loan to appoint a new successor to the late Peter Bailey.

The directors tell George that the Building & Loan will only stay open if he agrees to remain and carry on his father's work.

George foregoes a trip to Europe and his plans for college, giving the funds saved toward tuition to his younger brother.

While the family is celebrating Harry's return, Ma Bailey mentions to George that Mary Hatch is also back from college and he should pay her a visit.

Marty helped capture the Bridge at Remagen, Sam produced plastic hoods for planes, and Bert went to Africa to fight, where he was wounded and eventually got the Purple Heart and Silver Star.

Despite having to look after four children, Mary still had time to run the United Service Organizations in the town, and Mr. Potter became head of the draft board.

Harry, who became a Navy pilot, engaged in a risky interception of a kamikaze that was about to attack an Army transport, saving the lives of fifteen soldiers, to which he was awarded the Congressional Medal of Honor.

On Christmas Eve morning, Uncle Billy is on his way to the bank to deposit $8,000 of the Building & Loan's cash funds (the equivalent of $140,219.11 in 2024).

In this alternative scenario, Bedford Falls is instead named Pottersville, and is home to sleazy nightclubs, pawn shops, and amoral people.

Mary, Uncle Billy, and a flood of townspeople arrive with more than enough donations to save George and the Building & Loan; Sam Wainwright extends a $25,000 line of credit by telegram (the equivalent of $438,184.72 in 2024).

Bosley Crowther, reviewing for The New York Times, described Bailey as "a young fellow who wants to break away from his small-town life and responsibilities but is never able to do so because slowly they close in upon him".

[4] Kate Cameron of New York Daily News described Bailey as a "guy who wished he had never been born, when the going gets too tough, and was permitted to see what his home town would have been like without him".

[5] Variety's Bert Briller wrote, "At 30 a small-town citizen feels he has reached the end of his rope, mentally, morally, financially."

"[4] Cameron said, "[Stewart] carries most of the burden of this long picture on his still slender shoulders and for the most part gives an endearing performance.