The answer lies in the combination of many characters, props and special effects and even the resort's transient population, which, rather than hindering and preventing such shows, acts as a fan to the flames.
With three prominent theatrical companies and an emerging fourth - Whirlwind Productions, Remarkable Theatre, Showbiz Queenstown and Storming Theatre - Queenstown is treated to at least three shows a year, from the likes of Chicago and The Sound of Music to original ideas such as the forthcoming Twenty Seven.
Margaret O'Hanlon is behind Whirlwind Productions and is in the middle of rehearsals for Twenty Seven.
The New York native arrived in Queenstown 22 years ago and attributes the resort's theatrical success in part to its transient community.
''It's almost like the circus ... that kind of atmosphere and mentality is what performers are all about.''
But she is quick to say Queenstown also raises its own talented performers whose road to stardom can be quicker than those in cities because of opportunities often unique to Queenstown - such as the Winter Festival and various high-profile international acts.
''For a tiny town we have always had quite a few people who are involved in independent theatre - Queenstown is an independent town.
''I have seen theatre endeavours here come and go and it's nice to see new ones, like Storming Theatre, starting up.''
For all its successes, she said Queenstown does have its drawbacks.
''It's always been a struggle for what I do, which is independent production, because you always have a limited attendance in an audience.
''Sometimes you lose money and sometimes you don't, and when you do lose money you lose tons. You have to be a little bit nuts to enjoy that.''
Founding member of Storming Theatre and committee member of Remarkable Theatre Victoria Keating agreed Queenstown's make-up helped ignite a burgeoning theatrical and musical community.
She said when travelling, people tended to shed inhibitions and join clubs to meet people, which all helped theatre groups.
''Being such a tourist hub you get some incredible people coming through.
''People are just stunned that we have this level [of theatre] here.''
Despite the various production companies, she said, ''I don't think that any of us feel any competition at all'', and said the scene was not getting too overloaded.
''There's never any shortage of actors and the really nice thing is we all work together. Most people will appear in each other's shows and what that's creating for us is this wonderful theatre community in Queenstown.''
A new venture is Storming Theatre, of which she is a founding member.
''We sort of saw an opening for off-Broadway-style shows.''
Different venues are used, such as the Queenstown Airport, which was the location for Picasso at the Lapin Agile, and she said, ultimately, the company was aiming to be thought-provoking and to ''breathe a different type of creativity in different places''.
Showbiz Queenstown president Marty Newell said every year he was ''blown away'' by the talent in Queenstown.
Mr Newell said the opportunities in Queenstown were endless.
''There's an opportunity, if you want to get involved in the arts, 12 months of the year.''
He agreed the resort's unique make-up was a contributing success factor.
''You just don't know who's going to show up and that's a beautiful thing.
''You can have people who worked on stage in Broadway show up in Queenstown ... that's the great thing, every year there's just more people adding to the talent pool - the disadvantage being these people come and go.''
As well as Queenstown hosting talented people from overseas, he said, the resort's theatre community not only survived but thrived ''because of the passion'' within the local groups.
''What drives it is the community spirit in this town.''
