After the sloppy Kiss of the Spider Woman that opened its much-ballyhooed Kander & Ebb Celebration, Signature Theatre is serving up a happier second act—a sweet, stylish, and mostly satisfying tuner about a prodigal talent who roams the world looking for glory, only to come home to his provincial town and find himself there.

It’s called The Happy Time, and it wasn’t always the promising little package it is now. It had a sort of split personality, for one thing: It started out, according to William Goldman’s celebrated Broadway chronicle The Season, as a dark and delicate thing, “a small family show with an abrasive script…about a failure who didn’t get the girl.” But it was also a star vehicle for Robert Goulet, an attempt to capitalize on a bankable star by putting him front and center in a testosterone-fueled version of the big-lady musicals (Mame, Hello Dolly) that were then all the rage. And in development, apparently, the abrasive script got buffed smooth, sentiment and saccharine got shoved down the show’s throat, and director Gower Champion tarted up the proceedings with an immense, elaborate, and hideously expensive system of projections—the lead character, Jacques, is a celebrated photographer. The result: a razzle-dazzle fizzle, a show with no real identity and a story nobody bought. It lost its backers a million dollars—the first time that ever happened on Broadway.

John Kander and Fred Ebb never quite gave up hope, though, and there was a 1980 revival at Connecticut’s Goodspeed Opera House whose emendations reportedly laid the foundation for Michael Unger’s nicely nuanced chamber production at Signature. The treacle is mostly gone, the darkness is back, the script tweaked to refocus on story and character: The hero’s once-in-a-blue-moon visit to his hometown stirs things up for his old sweetheart and for his fractious family—especially for his nephew Bibi (Jace Casey), inspired by Uncle Jacques to rebel against his strict, dull dad—and in this telling, at least, the turmoil is pretty affecting.

The showgirls in that first-act visit to the burlesque house are four rather than the original eight, and the multimedia, while it’s still a crucial element, has been rendered intimate—credit Todd Edward Ivins’ handsome, carefully thought-out photo projections, strewn like family portraits across the rear wall of Signature’s cozy Ark space. New or restored songs (notably the tricky, triplet-strewn duet “In His Own Good Time,” deftly handled by Tracy Lynn Olivera and George Dvorsky) help enrich relationships, and it helps that in the decades since the show’s first go-round, audiences have developed an appetite for oblique, bittersweet anti-love songs like Act 1’s “I Don’t Remember You,” sung by Jacques with the schoolteacher whose small-town charms he’s trying to resist. (It’s a quietly marvelous tune, that, and it’s become something of a cabaret standard; Michael Minarik and Carrie A. Johnson sing it handsomely.) All in all, a crowd of us spent intermission in the Signature lobby wondering why The Happy Time hasn’t had a happier time of it.

Act 2, as it happens, offers a partial answer. A vaudeville number centered on veteran character actor David Margulies (playing the irascible, eminently sensible grandpère of Jacques’ French Canadian family) stands out as old-school showbizzy, a jarring uptempo interlude in a story that’s been steadily darkening and lensing in on interpersonal strife. And while the return to an unhappy, uncertain ending for our hero honors the creators’ original intent, there’s still work to be done: Jacques turns out to be something less than the glamorous globe-trotter he’s been fronting as, or so he confesses, but exactly who he is remains unclear—and there’s little to set up the confession that comes, with an awkward suddenness, at what’s meant to be the show’s emotional peak.

But things are certainly moving in the right direction, and the remaining issues are the sort of things that should be fixable with a book-tweak or three. Signature’s otherwise spot-on production, meanwhile, suggests that The Happy Time is beginning to look like that happiest of theatrical things—a once-troubled show whose worst troubles seem safely behind it.